RE:ResponseIIROC has asked TSO3 to issue the statement that they just put out. There is nothing material with the company to explain the share price changes.
Addressing, as I can, having read this inaccurate short report in its entirety, I will take Spruce Point's 'executive summary point by point, (I am sure management will have a lot more to add!!)':
1) TSO3 bears no relation for comparison whatsoever to companies like Valeant, Concordia... This comparison is a complete ruse and ridiculous.
2) TSO3 sells to Getinge and it is the latter's role to identify installs. Perhaps, now, they will? But, to say that only 10 VP4's are installed is ridiculous. They have single orders for that many. The shorter is playing on this lack of transparency because this is the one area that has been unclear and can instill fear in weak investors. I have repeatedly argued that Getinge has been slow to get the VP4 into the market, with only 25 or 30 sales people in the US dedicated to the VP4, vs the competition who have each well over 100, possibly because they want to wait until they own TSO3 before making their big push. More significant installs are nearly ready to be announced. And, I have argued that Getinge wants to keep this lack of transparency because they want to leave a seed of doubt out there so they can step in and buy TSO3 cheaply, as cheaply as possible, in the near future.
I just hope that Getinge and their associates have not conspired with Spruce Point to attempt to harm confidence in TSO3 and depress the share price in anticipation of riding in like a black knight with a low ball offer of $4!!
3) The past playbook for TSO3 was before Rumble came over from being head of low temperature sterilization at Steris (Spruce Point does not mention this important point in their description of Rumble's past!) and he put H2O2 sterilization (not patented) technology together with Ozone (patented by TSO3) to produce a low temperature sterilizer that is better and more efficient and effective than any product produced by Steris or Sterrad.
4) The world market for low temperature sterilizers is estimated at between 2400-3000 per year. This is the single largest growing market in the sterilization field. Presently, sterilizers are used in hospitals, but, as Rumble has repeatedly noted, the GI space for scopes and especially duodenoscopes, is where the growth is and will be.This is where growth of these numbers will occur. And, Sterrad and Steris sterilizers are simply inferior to the VP4 and will never be equivalent or as effective.
5) Getinge purchased Stericool at the same time as they inked the deal with TSO3. This Turkish company produces a non-patented H2O2 sterilizer that is not approved in Canada, the US, or other advanced markets. It is a knock-off of the Sterrad and only as effective as that inferior product. For third world applications, it has its place; but, it is not a competing prodduct to the VP4. Getinge will never walk away from the TSO3 deal. That is ludicrous! They are making a play for TSO3 as I write! This technology is a cash cow, and they all know it!
6) The competition is big and has larger sales and service forces than TSO3 and Getinge in N. America, but Getinge is bigger in Europe. Over time, the better technology of TSO3 will make it the market leader: TSO3 can solve problems that the competition cannot. All H2O2 sterilizers are hard on scopes, hydrogen peroxide. Older ozone technologies were harder on rubbers, lubricants, for example, but the concentration of ozone used to purge and increase the sterilization in the VP4 has been specifically designed not be be harsh or to cause more servicing for scopes than H2O2 alone. That is part of the beauty of this technology!
7) Employees have been hired recently as the company has been expanding rapidly, and the company has done its best to give them all a good trial in their positions, but some of these people have not met company expectations. They only want the best, and they are trying to hire only the best! They do not mention Rumble's considerable experience with Medivators and Steris! Come on!
8) This company has an extremely bright future (a hostile bid from Getinge or others not withstanding) and if it can take 30% market share from inferior competitors in the next two years, this would be fine. The company is scoping out locations for a facility in the US to build 500-1000 units per year in the future.
9) The targets noted here are ludicrous. They are meant to instill fear in retailers and cause them to jump like lemmings so that Spruce Point can profit. This is a ruse.
In there 'detailed' analysis, they note that the VP4 was given approval as being equivalent to predicate... IN 2014!! A lot has happened since! The buttons on a VP4 are simple and not flashy, btu the technology within is far superior. Check the compatibity matrix on the TSO3 site (especially for Canada) and you will see a list of important scopes that far exceeds the list of any competitor! The competition will NEVER have approval to sterilize the Olympus Q180V because they just can't do it! Period. This shorter takes data that is 3 years old and presents it as valid? Is this blatant fraud? Or, just misleading to unwary investors? And, they took photos of the Myrtle Beach facility on a Sunday? Come on!!
Sprott continues to own 13% of TOS. And, even Nuttal can make mistakes, (I have followed the kid for years, and he makes a ton of bad recommendations, unfortunately for those who listen to him).
And, the reason the US facility is in Myrtle Beach is because that is where Mr. Rumble family lives. That is where his wife and he are deeply involved with a charity that provides horses for abused children to ride as therapy to get over their psychological problems. Period. Rumble is an ethical Christian and a good person. He does not golf. He is not a manipulating scum like Acker of Spruce grove.