SPCEO1 wrote: Let me try to help - the dilution initially is around 21% if the overallotment option is taken up. If all the warrants were to convert, you are looking at 32% dilution but that additional dilution likely will not happen for three years as there is normally no reason to convert a warrant early. And history has shown that some warrants never get converted because people lose track that they own them and when the deadline is for conversion.
Management has actually achieved quite a bit over the last two years, for which they deserve a lot of credit. Sadly, this low end deal they did is going to stain that really good track record of success, which is really unfortunate and an unforced error.
They had $27 million at the end of last quarter and I am guessing they had about that much at the end of the fourth quarter to since they had a bigger take of the Trogaro sales and sales were better than expcted. After this deal, they will have about $70 million in cash.
As for squandering that cash, that is not going to happen. The cash may be mostly sitting there for a while. The trial costs for the phase I cancer trial in Q2 cannot be too substantial as they will be doing just one individual at a time. Once they move to 40 patients, in Q3, those costs will rise a bit but should still be manageable. If all they had was the cancer phase I trial, they would be no imediate need for cash.
But they also have the NASH trial, which they now say is a Q3 start. This is an expensive trial and will start to chew up some of their cash. I imagine it will cost at least $20 million in the first year but if the clock does not start ticking on that until late in Q3, the cash they just raised will be just earning interest in the meantime.
As far as the conference call, only sell side analysts are allowed to ask questions. But I think they have already gotten the message that this deal has not gone down well anyway. In fact, they knew that before they announced it as I surely hope this is not the deal they had aspired to get done. If so, we are in bigger trouble than I think we actually are.
Management knew what to expect from shareholders and did it anyway. They believe they understand the situation better than we do and they may be right. They certainly have more info about the company than we do so they have a significant advantage in determining what is best. But I sure cannot see any scenario right now in which this was the best option.
Jasonthehumble wrote: I feel for Stephen as all you guys who are also long term holder. We have sat by watching this crappy mangement team do nothing except waste our time with promises and not excuting. Now they have the audacity to dilute us by NOT 5, 10 or 15% but 30%!!! ARE YOU SERIOUS? 30% DILUTION?!
My hope is that after the dust settles, they will actaully use this money to increase the SP. I am okay with dilution if that means the market cap turns to a $5 Billion company. They JUST need to make sure they dont just squander the money and we will be in a worst situation than we are now.
SPECO- I want you on the next conference call to relay how upset us long-term investors are at this point. Our morale is low. They blindsighted us. They have not excuted. Their compensation package is exobant compared to their performance. They need to work for us..investors. We will walk away if this SH*T continues.
realitycheck4u wrote: Stephen
Calm down. The company needed the cash to execute, and as this board knows, it kept saying 'do this, do that', test here, research there. That takes cash. They were running out, and risking the entire company is simply stupid. So they could not put their foot to the floor and hire more bodies and take more one - yet everyone here was complaining to go faster, better web site, more presentations, more tests...more indications, more research, more partnering, more etc.
You need cash in the bank for YEARS to be taken seriously. They did not, and they had debt coming due - with no cash runway. Could they have done deal later. A bit. And, they could also have raised less. But, we do not know the full story, nor will we ever. Are their insiders in this play today?? Absolutely. Belucky there are insiders playing today. Because now they are invested.
So sit down. Plan your new home. Becuase this is on its way.
CreatingApe wrote: Just when years of patience seems like it is going to start paying off... the share price was going to continue an upward trend for weeks/months! They gave it three days before smothering the momentum (once again) and my faith in this company. Wish i had never heard of f***** therf.. my money being trapped in this investment has literally changed the course of my life over the past years. But even through the pain of watching it diminish in value for months on end, I kept faith that management was sound and mostly honest, with everyones best interests in mind. I stayed optomistic the entire time, and focused on the great opportunities the future held for the company and us shareholders. Now, I feel like a f***** fool. This deal really feels like some insider B.S. Where some people close to the company are making off like bandits at our expense.
Anyone, please feel free to give me a good reason to not dump this at the next decent opportunity (almost definitely at a significant loss, after having half of my capital tied up for 4 years during a bull market) I am 30 years old and this was my first big investment. I had done well day trading but I invested in theratechnologies as a long term investment in a company I believed in. And now, for me, the belief is out the window.
I should have bought land and built a home. I had the money to do it. Maybe I am overracting, but this deal just smells like corrupt bullsh***. Wish I could take back my money and the last 4 years of my life.
Go f*** yourselves Theratechnologies.
Sincerely, Stephen