Glossary of Hostile Takeover Terms with Discussion

Discussion in 'Allergan' started by Shoham, Jun 13, 2014 at 2:08 AM.

  1. Anonymous

    Anonymous Guest

    Wow, you literally have no idea how markets work do you?

    If you knew a company was willing to pay 200 a share, and you could buy at 183, wouldn't you? You rrally think the short term holders are selling right now, with a clear path to an additional 6.5% premium???

    Complete lack of knowledge evident
     

  2. Anonymous

    Anonymous Guest

    New poster here. There is no $200 offer. People are buying based on upgrades and the fantastic quarter that has just been turned in. VRX is saying $200 with no real offer. The other poster was correct. Short selling is coming to an end. Pyott has been masterful in his handling of this and the AGN long term holders are digging in based on the numbers.
     
  3. Anonymous

    Anonymous Guest

    If this were true, the buying would have occurred yesterday when Q3 results were announced. I suspect a lot of the buying today is either in anticipation of an upgraded offer or short term-ers trying to get in before the 10/30(? I think that was the date) record date for voting.
     
  4. Anonymous

    Anonymous Guest

    I think (?), if the person/hedge fund/mutual fund etc. intended to be able to vote their shares in the Dec. 18 meeting, the purchase of additional AGN stock had to be completed by the end of the trading day on October 27 (+three days for share purchases to be settled = cutoff date of October 30 for declaring AGN share ownership for purposes of placing votes/proxies to support Allergan board or to vote them off the island.)
     
  5. Anonymous

    Anonymous Guest

    This is correct

    The only thing that happend today was 4 price target increases based on yesterday's earnjngs
     
  6. Anonymous

    Anonymous Guest

    That, and anyone who thinks a deal is likely and isn't worried about the vote, would still be buying. Since any shares changing hands in either direction after the 10/27 date aren't voteable. All the voting shares are in the voters hands. Which is why AGN will keep rising towards 200 until the vote. Since the short term guys already know which way the vote will go.
     
  7. Anonymous

    Anonymous Guest

    El. Oh. El. I always know some bullshit is coming when the first sentence is "new poster here."

    Thanks, you didn't disappoint.
     
  8. Anonymous

    Anonymous Guest

    Hate to tell you Bucky, but there is NO $200 offer. Words words words, blah blah blah
     
  9. Anonymous

    Anonymous Guest

    Um no. The stocks track together when it's about the deal not an individual thing.

    Also no $200 offer at all ... VRX essentially said the offer will equal $200 when their stock gets to $150. Well no $hit Sherlock, it would be $300 offer
     
  10. Shoham

    Shoham Member

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    Re: What to Look Forward to This Week and Next

    Some thoughts about the week thus far:

    Monday (October 27) was a bit comical. Exactly as expected here, Allergan's earnings were just slightly above the October 10 guidance. (No, I'm not clairvoyant and I don't have insider information; it's just that these are the best possible credible numbers). The release was scheduled, long in advance, for 7AM EDT. This is a fair timing for an earnings release as it gives some hours before the market opens for everyone to absorb the news (in a prior post I gave a brief rant about how releasing material information during market hours is disrespectful to small investors). Even when the market is closed, there are some 'off-hours' venues where trades may take place, and new price points may emerge, but these are thinly traded and market watchers do not take these price points very seriously unless there is some dramatic news -- in which case these 'off-hours' trade may provide a preview of how investors are taking the news. What made Monday so comical was that Valeant issued a 'surprise' press release timed for 6:55AM. Yes, exactly, 6:55AM. Come on. No one just accidentally times a press release for 6:55AM (the unusual timestamp was noted by some reporters!). The press release mentioned the number $200, but the small print took much of the content of that number away (by saying that it depends on Valeant's share price increasing -- dahh!)
    So, why the strange timing? My guess is that Valeant was worried that Allergan's share price would skyrocket after the release of the 'blowout quarter' (After all, Valeant share price, after their own engineered 'blowout quarter' -- or even a numberless guidance that they are anticipating a 'blowout quarter' -- does skyrocket, at least temporarily). If Allergan share price skyrockets after announcing a 'blowout quarter', it will be a boost to the Allergan standalone claim by showing that the market values Allergan's ability to generate good earnings and is thus less interested in the Valeant merger. By uttering the $200 figure -- a nice, round, magical, number that is sure to grab headlines -- any skyrocketing in Allergan share on Monday will be mindlessly attributed to the $200 "bid." -- after all, reporting that the bidding crossed a big round number is always sexier than a boring earning release whose 'blowout-ness' was previously communicated.
    ($200 is also the Allergan-leaked number of the minimum bid that the board will negotiate against; of course, when it comes to Valeant, if they want to get Allergan's board attention, that $200 better be in cash, since the Allergan Board has made it clear they consider Valeant shares, regardless of trading price, as trash).
    The only potential flaw with this grabbing-credit-for-the-stockprice-skyrocketing ploy came from these pesky 'off-hours' trades. If the Valeant press release was timed hours before or hours after the Allergan 7AM release, and the 'off-hours' market were to do nothing after the Valeant release, but were to explode after the Allergan one; then it may well be taken that the market is seeing through and laughing at the vacuous Valeant statement, while taking the Allergan 'blowout quarter' seriously. Any subsequent Allergan share price skyrocketing during normal market hours would now be unambiguously attributed to the 'blowout quarter,' and not the $200 'bid.' By hitting the wire at 6:55AM, Valeant made sure that their release is read first, but that no action in the 'off-hours' market can be unambiguously attributed to Allergan's numbers.
    :eek::p;) And, the really most comical bit: After all this careful timing, credit grabbing, and gaming; the market laughed at both. Neither the 'blowout quarter,' nor the 'magical $200' did anything to move the stock. It was slightly up on the open, and slightly down on the close. :eek::p;) Ha. Ha.

    Tuesday (October 28) was the Insider Trading court hearing date. Decision is expected within days. I haven't seen any transcripts, so I don't know what exactly happened in the hearing. I know court reporters like to try to read leanings out of judges' questions, and I don't know enough to say that it can't be done; but I have never been able to see such (unless a judge uses some sharp language -- like the now-famous 'horse choker' comment from the DE judge). We know the arguments. We know we are on uncharted legal territory. I guess we just have to wait and see what the judge has to say. I do, however, want to remind everyone that the court case is still the side show (a soft power, in a game that is moving into the hard power phase). A loss in the court, for either side, while a set back, is not the end. If Ackman's share are frozen, he can probably unfreeze them by posting an escrow equal to the gain he made through Insider Trade (effectively, re-purchase them at the price he would have paid if he didn't Inside-Trade). The escrow would be about $50/share (the difference between the price he paid for the shares, about $120 each, and what they were trading for immediately after the news was released, about $170 each), or about $1.5B. However, with the Allergan share price over $180, he would still be in the Black, and he can continue his battle. (And, as I noted in an earlier post, even if Ackman and Valeant are chased away through this lawsuit, this won't stop the next guy around -- who will not have the shady dealings of Valeant and PS -- from saying they can acquire Allergan and finance it by killing all R&D). Likewise, if PS wins, and Ackman's shares retain full voting rights, whatever hard power play Allergan is planning to affect by December 18 (or, find a way to make a winning argument that they don't need to make any), would still be available.
    I don't know if there is any significance to this (probably none), but I did note that Ackman and Pearson, based in the East Coast, were personally present in the Santa Ana courtroom; whereas David Pyott, based in Irvine (a walking distance from the courthouse) was not. (I suppose, if the judge wanted to ask him something, he could be there in minutes).

    Dan.
     
  11. Anonymous

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  14. Shoham

    Shoham Member

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    I read through the transcripts. A bit tough, since it referred to exhibits, regulations by numbers, and prior cases that I don't know and haven't (and aren't planning to) look up.

    The tone of voice of the Allergan lawyer was very relaxed, but sometimes I felt he was getting tangled. The judge asked him a lot of questions -- indicating disagreement on some issues. In many places the judge was basically asking why won't just requiring PS/V to disclose more won't suffice. I did feel that his final punchline -- that if the injunction isn't granted Allergan would be strangled and the shareholders would be forced to sell below market value -- was very strong.

    The PS/V lawyer, in contrast, had an angry animated tone -- as if saying this whole suit is such a non-starter waste of time. While I only read transcripts and didn't see the live action, I imagine he was quite animated in movement and not just tone. This exchange took place in one of the more animated exchanges:
    THE COURT: Don't get too close to counsel.(LAUGHTER)
    MR. HOLSCHER: We're okay. It's a client issue.
    MR. WALD: He touched me, Your Honor.(LAUGHTER)​
    The judge asked the PS/V attorney less questions, and they mostly related to the standing issue (PS/V claims the Allergan has no standing to complain since it is not the victim; whereas shareholder Parschauer can go sue for monetary damages, if she wants to, but not to block any shares from voting).

    Just as a reminder, Karah Parschauer is co-plaintiff. She is a shareholder who sold during the time when Ackman knew the Valeant bid was coming and she didn't -- making her a victim of the alleged Insider Trading. She is also an Allergan employee and attorney (VP level). At the time the suit was filed, I was wondering why Allergan didn't bring some non-employee shareholder who sold (even just one share) during that time period so as to keep their victim-hood issue cleanly detached from Allergan employment (come on, how hard is it to find such a shareholder -- class action lawyers never have troubles finding alleged victims!). I kind of assumed that the smart lawyers of Allergan know the laws and mechanics well enough that they didn't feel the need to go find such. Well, apparently not, the judge heaped a handful of dings on the Allergan side pointing out that as an employee who got her shares at a discount, her victim-hood status is uncertain.

    The judge's final words probably put it best:
    THE COURT: It's a pleasure. Now, I don't know when you'll hear from me, but it will be in a relatively reasonable period of time. If I need additional briefing, I'll send that out to you, and instructions will probably be no more than five pages.I don't think so. The number of areas I'm still struggling with, one of those is standing. That's why I repeatedly asked you to address that particular area. There is not a lot of law that supports either position, frankly. So I want to thank you. I think your briefing was excellent. I want to say that to you publicly, and I think your arguments were extraordinary and the court appreciates your efforts.​
    (Emphasis mine)

    Dan.
     
  15. Anonymous

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  16. Anonymous

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  17. Anonymous

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  18. Anonymous

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  19. Anonymous

    Anonymous Guest

    Dan mentioned at the end of his post #270 that it was notable that David Pyott was not present in court at the 28 October hearing, although Pearson and Ackman were present for their side. Just want to add that during the proceedings, for the Allergan side Douglas Ingram was present (Allergan President and has a seat on the AGN Board, also is a lawyer according to his biography info); Karen Parschauer (the plaintiff/Allergan VP "harmed" by the challenged Pershing Square/Valeant manoeuvers to purchase their 9.7% toehold in Allergan, as she was selling some of her shares; and Gavin Herbert, founder and former chairman and CEO of Allergan.

    Conjecture: Maybe there was a strategy to keep Pyott from such a public face-to-face against Ackman/Pearson at this point. In Pyott's Q3 2014 presentation given the day before, he noted that at any given time, there are (deliberately) no more than 10 people working on the anti-takeover strategy at any given time; that the employees are continuing their undiluted attention to deliver value to the company (read shareholders). For Pyott to be present at this hearing would just be a tabloid distraction, and one that would work more toward Ackman's benefit, than toward Allergan's. Pyott is making a point to avoid direct engagement with Valeant/Pershing Square, no matter how much they demand he must as part of his fiduciary role to the shareholders.

    The presence of Gavin Herbert must have had a certain force. Herbert is on record as stating, "I'm proud of the fact that during the past 60 years, Allergan has had just two CEOs after me: Bill Shepherd and current CEO David Pyott. I think this has helped us to stay focused on what we do best -- staying close to the medical community and addressing unmet patient needs within our specialties." Herbert also said in the same 2010 Allergan annual report, "I have been actively involved with Allergan's research and development committee, and that's where the future of Allergan is being created. Three things give me confidence: the qualities of the people, the ability to turn things around fast, and a robust product pipeline." Herbert was there representing not only Pyott, but literally representing Allergan in its entirety, past and present and future, venerable and respected.
     
  20. Anonymous

    Anonymous Guest

    Just wanted to revive this thread. What says the guru now? I feel kind of dumb for listening to this supposed business expert.