RE:RE:Taurx Phase 3 Trial UpdateI don't think it makes sense to sell TauRx prior to the results unless they get an offer significantly higher than carrying value. Dundee definitely doesn't need the cash.
It seems that most investors (including you) and certainly the market are valuing the TauRx investment at close to nothing.... so why not hold the investment through the trials? If the trials are unsucessful maybe Dundee's investment in TauRx is worth a little less than carrying value (definitely not zero) and if successful TauRx would be worth US$15B+ (and Dundee's 4% investment in TauRx CA$800M+). Linked/copied below are articles from WSJ and Globe discussing a TauRx IPO at US$15B post trials in 2017 (probably higher today).
In my mind, looking at TauRx (through Dundee) this is a "tails you don't lose; heads you win very very big" scenario...
Wall Street Journal Article: https://www.wsj.com/articles/singapore-developer-of-alzheimers-drug-plans-u-s-ipo-1451543494
Globe article:
"Dundee flyer on pharma company could solve balance sheet bind
Dundee Corp. had a rough 2015. The Toronto holding company's share price fell by 64 per cent, largely because of heavy exposure to the ragged resource sector.
But 2016 has started off dramatically better, and that's mostly because of a flyer that former chief executive officer and founder Ned Goodman took on a hitherto unknown, privately held pharmaceutical company.
In 2011, Dundee invested $20-million (U.S.) in TauRx Pharmaceuticals Ltd., a Singapore-based developer of Alzheimer's disease treatments. In 2013, Dundee put in another $10.5-million. As of Sept. 30, its then 5-per-cent stake was worth $68-million. However, the TauRx investment may end up being worth a lot more.
On Monday, The Wall Street Journal reported that TauRx is considering an initial public offering (IPO) in 2017 at a possible $15-billion valuation. In that scenario, Dundee's current 4.3-per-cent stake (Dundee has been diluted down a little since Sept. 30) could be worth $645-million. Dundee's class A shares were up 13 per cent on Monday and another 15 per cent on Tuesday.
A lot of ducks need to be put in a row before any TauRx IPO transpires.
As the Journal points out, almost all clinical trials for Alzheimer's treatments have ended in failure. The IPO market is also a notoriously fickle beast. Dundee could, of course, sell its stake privately in the interim – likely at a much lower level than that 2017 blue-sky valuation.
Having the option to sell could prove extremely useful, though. The company has been trying to convince holders of more than $100-million (Canadian) in its retractable preferred shares to exchange their quasi-debt securities for a new series with a higher dividend. Last month, Dundee said that large institutional shareholders had "expressed concerns" over the offer, and "the proposed transaction terms may be amended or withdrawn." Should the offer not get passed in an upcoming vote, Dundee will need to come up with a plan B. Otherwise, holders of the retractable shares can request a full cash payout at par in the summer of 2016. Selling the TauRx stake (or part of it) could get Dundee out of a jam."