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Biotech / Medical : Gliatech (GLIA)
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To: Spekulatius who wrote (1697)8/29/2000 1:54:07 AM
From: Torben Noerup Nielsen  Read Replies (1) of 2001
 
I agree it will dive on the opening. But I'm somewhat surprised that there's no significant after hours activity.

The press releases also do not make sense. There has to be other reasons behind the break off.

Go back several months and look at the earnings estimates for GLIA. They are *beating* the estimates. They are also beating the sales estimates for ADCON-L handily. Without the merger related expenses, GLIA would have been profitable in the second quarter. As far as I can tell, the total loss per share for the first 6 months is $0.01 and that is *including* the merger related expenses. Without those, Gliatech would now be profitable.

Honestly, I don't doubt the shares will be hammered at the open. This is a bloodbath in the making. And I stand to loose some pretty substantial amounts of money. But I do not have enough information to tell why.

I wonder how the shares would have fared had they not decided on the merger. Higher or lower?

Does anyone have a better handle on the FDA issue? Is it just ADCON-L - bad enough - or are there problems with ADCON-A/P?

I vaguely recall some reports estimate sales at $2.5M or so. Reality is close to three times that. I also recall projections of loss. But that has so far not come to pass. Take out the extraordinary expenses and Gliatech is at least break-even now.

Gliatech isn't broke either. There's cash in the bank and at this burn rate, they shouldn't run out anytime soon. Next quarter will carry a charge for their build to lease facility, but that charge will be reduced if they actually use it.

I'm of a mind to liquidate even though it will cost me a lot of money. I just can't help but think that I have yet to hear the real reasons behind this mess.

Will it open at $15 and bounce a bit? Even dead cats do.... I'm mentally steeling myself for a $250K loss tomorrow. Those are the breaks when you play high stakes poker. Besides, nothing I can do about it so I might as well just accept it and move on. It will come close to matching my gains on Viropharma so far. Between the two, it's close to a wash.

Thanks, Torben

Thanks, Torben
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