RE:Pfizer Fine was A Fraction of What it Could Have BeenWhat a baggie this poster is to suggest that Cinven may forgive their earnout payment! Are you absolutely nuts? Cinven is ruthless PE and they have lost enough money they would never hand wave the earn out away. Is this all you have for a bull thesis? And No, I don't think that Chapter 11 is wishful thinking - the market has come to realize that it is a real possibility and the stock and management are behaving like companies before they announce. Are you on some kind of drugs saying "I sincerely hope" Oh well, keep hoping, it is after all, what makes a stock market. You were probably one of the ones here saying months ago that there is no way that Pfizer will ever get fined. I bet you you don't even know how many drugs CXRX is being investigated for. Pfizer had one. From the sounds of things, AMCo has a few.
Lumberfeverlong wrote: Under its governing statute, the CMA is entitled to impose a fine of up to 10% of a company's global annual revenue. Pfizer generated global revenues of almost $50B USD last year meaning their fine could have been up to $5B. I suspect that Pfizer is very relieved by the outcome and, despite this, it is still appealing the decision. As for Condordia, I think the CMA decision bolds well. First, we still have no indication that the CMA believes Concordia violated any UK competition laws, but assuming they conclude as such, the Pfizer fine suggests any fine imposed will be far less than Concordia's global annual revenue. A $90M USD fine for Concordia would be inconsistent and disproportinal with the fine imposed on Pfizer.
And for those here who are still touting a Chapter 11 filing anytime soon, you know it is mere short wishful thinking. The business will take several quarters to meaninfully recover, but as it stands it is still generating sufficient cash flow to cover operational and debt related expenses.
Finally, people forget that Cinven is Concordia's largest shareholder. It has lost more money than anyone else with the share price tanking over the last several months. I believe we are at an inflection point where they might forgoe payment of the earn-out in order to recoup a much larger amount on the appreciation of the share price. This could be an outright foregiveness of the debt or a conversion into equity. In either scenario, all STAKEHOLDERS, except for shorts, would benefit from a balance sheet improving transaction. I sincerely hope that this is what is keeping management busy these last few weeks. In any event, we will know before Christmas and I sincerely hope it is a good one for all longs and bondholders!