RE:RE:RE:RE:understanding the deal, more questions than answers for meI take some comfort knowing that Cantor Fitzgerald is a Bay Street big deal. They are a Wall Street big deal. They are going to bring some US eyes to the company and while it totally sucks that we have to see a financing that kneecaps the share price, I like the One-Half warrant a significant premium to where we were even yesterday.
That signals to me that they believe there will be considerable upside (more than double) for that math to make any sense.
If they have their big wallet investros at CF who will take this full amount quickly it is not because they are granny and gramps buy and hold investors for the long term.
They are likely players who want a piece of something that is on the way up and quick.
JMO.
BUT, I do know that they don't bother looking at things like this for 2x multiples. They are thinking bigger than that and they can then start to drive the bus a little more by getting exposure and action stateside.
I have been crushed in biotechs before with financings that totally sh!t the bed.
BUT, I have also had the good fortune of what would seem to be a terrible financing with a great set of investors who ended up making the little biotech move to a takeout target for a major pharma at about 40x.
Not getting greedy here... but I would think that 3-5 x is not unreasonable.
Raise money when you CAN....not when you HAVE TO.
I hate hearing it. But it is often very true.
In Biotech it is often in the weeks leading up to a data release when everything is frothy. It hurts but thankfully it means the company can live to fight another day if the results are less than stunning.
JMO.
GLTAL
HnG