Join today and have your say! It’s FREE!

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.
Please Try Again
{{ error }}
By providing my email, I consent to receiving investment related electronic messages from Stockhouse.

or

Sign In

Please Try Again
{{ error }}
Password Hint : {{passwordHint}}
Forgot Password?

or

Please Try Again {{ error }}

Send my password

SUCCESS
An email was sent with password retrieval instructions. Please go to the link in the email message to retrieve your password.

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.
Quote  |  Bullboard  |  News  |  Opinion  |  Profile  |  Peers  |  Filings  |  Financials  |  Options  |  Price History  |  Ratios  |  Ownership  |  Insiders  |  Valuation

Bullboard - Stock Discussion Forum YM BioSciences Inc YMI

NYSEAM:YMI - Post Discussion

YM BioSciences Inc > Managed Market?
View:
Post by RetailRube on Mar 29, 2010 8:38pm

Managed Market?

I notice that the YM stock price has been exceptionally stable since the private placement announced on March 5. I looked back about two years and could not find a similar period when the stock "flat-lined" for a month. Look for yourself. Here is the graph on Google. It is important to play with the settings to use a log scale for the Y-axis so that the low-priced periods have percentage moves visibly equal to higher-priced periods.

https://www.google.com/finance?q=tse%3AYM


I have seen this before, where the company did an offering and the stock was rock steady before trading up. It is never admitted, but I am suspicious it is because the underwriters sell into the market, after a private placement which gave a big discount to market, to defuse the anger of shareholders who got diluted. But why for so long ... a month? I think it is related to their acquisition of Cytopia.

Oct-5-2009: Announced acquisition of Cytopia, paid for with YM shares. (previous day close = Cdn$1.57)

Jan-7-2010: Roth Capital initiates analyst coverage. (previous day close = Cdn$1.41)

Jan-11-2010: Stock hits recent high (Cdn$1.90)

Jan-29-2010: Cytopia acquisition closed (number of shares of YM issued as payment adjusted @ Cdn$1.72)

Mar-2-2010: Announced lien on patents in US (stock dropped to Cdn$1.22, but recovered to close at Cdn$1.46)

Mar-5-2010: Announced private placement at US$1.20 (=Cdn$1.234). (Prior day close = Cdn$1.40) Roth is one of the underwriters. (stock closed at Cdn$1.17)

Mar-5 to Mar-29: Stock trades in range around Cdn $1.18

Here is the opportunity: Most private placements go out at a discount to market. This one was -12%. But the dilution should have dropped the stock from Cdn$1.40 to Cdn$1.36, not to Cdn$1.17. But if it didn't drop to near the private placement price "for reasons of general market volatility", what would the Cytopia shareholders think? 30 days before the private placement, they got paid in shares at $1.72 instead of getting more shares at $1.20. Some of the shareholders of Cytopia are now employees of the merged YM company. I think for reasons of "peace in the family", this stock is being temporarily held back. I predict that after the Easter long-weekend, it will trade up to $1.36
Comment by RetailRube on Mar 30, 2010 6:36pm
One other idea to explain the aggressive selling:  Maybe Cytopia shareholders have now received their YM shares from the takeover and are unloading them to cash in.  I tendered shares to an acquisition once and I swore "never again".  It took several weeks for the broker to reconcile the shares and credit them to my account so I could sell them.  Meanwhile, the stock ...more  
The Market Update
{{currentVideo.title}} {{currentVideo.relativeTime}}
< Previous bulletin
Next bulletin >

At the Bell logo
A daily snapshot of everything
from market open to close.

{{currentVideo.companyName}}
{{currentVideo.intervieweeName}}{{currentVideo.intervieweeTitle}}
< Previous
Next >
Dealroom for high-potential pre-IPO opportunities