MYX - Mayne Pharma Group

[Knobby22]

Wrong, Knobby - sorry
Due to the T+2 rule, you have to have bought at least 2 days BEFORE the record date. That makes the EX-Date yesterday, but as there was a trading halt, today is/was the first day on which holders could sell their MYX shares, yet retain the entitlement to those new cheapies.

spot-on, skc. Ours crossed.

Wow, that makes the buying frenzie even better news. Very happy. Thanks pixel.

 

[kid hustlr]

NO. Buying today will NOT allow you to participate in the cap raising. Record day is today... with T+2 settlement you needed to buy 2 business days ago.

Today's buying frenzy is caused by the fact that MYX is able to buy such a large important asset from a forced seller (Teva forced by regulators to divest). Teva deliberately chose a mid tier pharma to sell the assets to... so MYX kind of luck into it.

It's transformational - hopefully not Slater and Gordon style.

If I'm im entitled to the offer is free money for me though isnt it?

I can buy them at 1.28 through the offer and then sell them at market @ 1.91?

arbitrage?

EDIT:

Any chance I don't get my full allotment?

 

[VSntchr]

Teva deliberately chose a mid tier pharma to sell the assets to... so MYX kind of luck into it.

Presumably so they didn't give a close competitor a handball?
Interesting stuff.

 

[VSntchr]

If I'm im entitled to the offer is free money for me though isnt it?

I can buy them at 1.28 through the offer and then sell them at market @ 1.91?

arbitrage?

Yes. But being entitled is a very big privilege in this case! One of the nice perks that the stock market throws up every now and then. Right place right time...

 

[pixel]

Wow, that makes the buying frenzie even better news. Very happy. Thanks pixel.

You don't see it very often that a cap raising is greeted by a gap-up rally.
At $1.28 per new share, today's rise gives holders a nice EoFY profit.

However, it is quite possible, highly likely even, that a good number of enthusiasts fell into the same trap and assumed that buying today would include the opportunity to top up much lower. Holders might have welcomed those enthusiasts and sold them some of their holdings in order to free up funds for the buy-in at $1.28. Bear in mind that not every investor has unlimited funds, or lax diversification rules, that they can increase a single holding by almost doubling it.

 

[pixel]

If I'm im entitled to the offer is free money for me though isnt it?

I can buy them at 1.28 through the offer and then sell them at market @ 1.91?

arbitrage?

EDIT:

Any chance I don't get my full allotment?

Entitlement is entitlement. As long as your cleared funds arrive in time, the company can't legally reduce your allotment. To make sure my money arrives in time, I usually transfer electronically, preferring BPay where possible.

However, if you want to sell at $1.91, you may be well advised to do so today, because there is no guarantee that the sp will remain this high until the day that you have your $1.28 shares in your CHESS account. That won't happen until 25 July.

 

[skc]

If I'm im entitled to the offer is free money for me though isnt it?

I can buy them at 1.28 through the offer and then sell them at market @ 1.91?

arbitrage?

EDIT:

Any chance I don't get my full allotment?

Yes you can either short or sell your shares (to your entitlement amount) today and lock in the profits. It's not so much free money though... i.e. not something I can do now if I wasn't a holder at record day.

It's a 1-for 1.725 rights entitlement and you won't be scaled back at this ratio. Some offers have top up provisions which would be scale back if too many people apply for them.

 

[McLovin]

It's a 1-for 1.725 rights entitlement and you won't be scaled back at this ratio. Some offers have top up provisions which would be scale back if too many people apply for them.

I had that with APN a few years ago. It was free money. The cheque I sent in was about $400k over my allotment, knowing it would get scaled back. Amazing how many people don't take up the entitlement even with the outcome so clearly in their favour.

 

[skc]

I had that with APN a few years ago. It was free money. The cheque I sent in was about $400k over my allotment, knowing it would get scaled back. Amazing how many people don't take up the entitlement even with the outcome so clearly in their favour.

Well not everyone has $400k!

I did that during the GFC with a few of these cap raisings. There was fear around the time so take up rates were lower for many raisings. And the companies really want to maximise the amounts of new funds they receive... AND they have record dates set after the announcement. It was free money. I used to go through company balance sheets / 4Cs just to see if they have a chance of raising capital... then I buy a minimum parcel and apply for truckloads if the opportunity presents itself...

These days, company tend to scale back most applications to some multiple of your existing holdings (e.g. no more than 50%, as in the case for MYX), or they say "placement of any short fall at absolute discretion of management) and then they place the shortfall to their mates.

 

[pixel]

I had that with APN a few years ago. It was free money. The cheque I sent in was about $400k over my allotment, knowing it would get scaled back. Amazing how many people don't take up the entitlement even with the outcome so clearly in their favour.

The recent CZZ Entitlement offer also included a top-up allowance of up to 50%.
I upped my payment accordingly and am pleased to find the new shares in my CHESS account. As the new shares were also participating in yesterday's dividend, the effective cost of just under $19 made it a no-brainer.

 

[Wysiwyg]

I tend to hold over 6 months. Once I am on a trend I stay on it till it changes. No reason for me to sell yet.

Nice little gap up hey. Well done!

 

[Knobby22]

Nice little gap up hey. Well done!

Got the rights shares today , now my 4th biggest holding. Every now and then you get lucky.

 

[ROE]

Come and grab a bargain today value investor -

 

[Knobby22]

It's called catching a falling knife. Likely to get skewered.

 

[ROE]

- I got them 128 118 110 happy to catch more ... my style I catch knives with gloves

 

[Knobby22]

- I got them 128 118 110 happy to catch more ... my style I catch knives with gloves

Cool. Having a look, damn USA legal system specialises in this, look what happened to CSL and they were completely innocent. I am keeping a close look, might join you next week.

 

[ROE]

Text book value play really
one off event if they are guilty wreck harvoc to the price but the damage to the business is temporary but when you get them cheap it a permanent and long term business value still in tact

So long term it will reverse back to the value of the business the one off event gone

Right now they not event guilty it just news and circulation and uncertainty
Yet the business nearly half at the time they acquire generic division from Teva as a force seller which is a stunting purchase

That division already grab 50m in revenue a matter of weeks since they done the deal

Over reaction much?

 

[luutzu]

Text book value play really
one off event if they are guilty wreck harvoc to the price but the damage to the business is temporary but when you get them cheap it a permanent and long term business value still in tact

So long term it will reverse back to the value of the business the one off event gone

Right now they not event guilty it just news and circulation and uncertainty
Yet the business nearly half at the time they acquire generic division from Teva as a force seller which is a stunting purchase

That division already grab 50m in revenue a matter of weeks since they done the deal

Over reaction much?

With some 1.5Billion shares out. At $1.20 that's a $1.8B company.

Sales last FY was $267m; NPAT $37.4M.

The multiple doesn't point to an obvious bargain.

Especially given the reported figures above is a doubling of its previous operations.

So maybe the future is a much bigger beast with much brighter future than previous norm... but it's not an obvious bargain. Though need a closer look, particularly given that this DOJ subpoena thing has been going on for some time now - today's seem a more formal get-your-azz to our office kinda invite.

 

[ROE]

You forgot the acquisition it will pretty doubling in size with sales and growing .. that won't reflect in the current figure till next year report

60-70% earning will now coming from the US with higher rate and our lower dollar.

I stand to call it a bargain and put 30% of my portfolio money with today play

If our local billionaire keep buying as far as last week I am better off investing with them

 

[Klogg]

You forgot the acquisition it will pretty doubling in size with sales and growing .. that won't reflect in the current figure till next year report

60-70% earning will now coming from the US with higher rate and our lower dollar.

I stand to call it a bargain and put 30% of my portfolio money with today play

If our local billionaire keep buying as far as last week I am better off investing with them

After reading a little more about this, I can't help but agree. 6 different companies were accused of some form of price fixing (or similar activity), but that is notoriously difficult to prove. Add to that the fact that doxycycline is not a major revenue provider for MYX (from what I've read), and it really is a storm in a teacup.

What's even more interesting is the purchase of the portfolio of drugs from Allergan. Given the $40bn acquisition of Allergan Generics by Teva, the $US650mn odd sale is inconsequential to them.
Further, given the FDA was essentially forcing them to sell off this part of the Allergan drug portfolio, it seems like the alignment of incentives ensured MYX got a good deal.

This gets more interesting as I dig... Thanks for the heads up ROE.