Much thanks to this board. Been reading messages for quite awhile and appreciate the level of discussion. Have not joined until now – no real expertise to contribute. But I can do basic grunt work, so here’s something to focus on. It’s my very rough estimate of breakup value, which I consider the worst case for Elan. I think I’m being conservative, but I don’t understand all of the factors and I have a feeling there’s stuff going on I’m missing. Otherwise, the price at under $2 is just plain dumb – and a major opportunity. What I’d like is feedback on specific items. What’s too high/low and why. When I get a bunch, I’ll repost the analysis to reflect your more sophisticated knowledge of the values. My starting point is the recent Elan release as of 9/30. Sorry for the poor formatting. My alignment of the numbers in the analysis seems to be trashed when I "submit" the post.
Cash 633,000,000(Elan)
Core drugs
Skelaxin 300,000,000 (Guess)
Sonata 250,000,000 (Guess)
Frova 200,000,000 (Guess)
Non-core drugs
Abelcet (done) 370,000,000 (Elan)
Actiq (done) 50,000,000 (Elan)
Other sales(done) 40,000,000 (Elan)
Hospital products
Maxipime 350,000,000 (G)
Azactam 50,000,000 (G)
Myobloc/Neurobloc 60,000,000 (G)
Misc
Avinza (Ligand)
Roxicodone
Other minor products
Naprelan
The above 4, say 100,000,000 (G)
Total non-core drugs 1,020,000,000
Epil asset value 354,000,000 (Elan)
Drug delivery business 300,000,000 (Guess)
Investments and marketable
securities 929,100,000 (Elan)
Diagnostics business 300,000,000 (Guess)
Athena Neurosciences / Alzheimer's 500,000,000 (Guess)
Pipeline
Antegren 1,000,000,000 (Guess)
Zonegran
Prialt
Eln 154088
Above 3 100,000,000 (Wild Guess)
Total assets 5,886,100,000
Restructuring liability 150,000,000 (Wild Guess)
Debt (Elan)
7.25 % notes 2008 650,000,000
Product payments 495,000,000
EPIL maximum 2004 450,000,000
EPIL maximum 2005 390,000,000
LYONS 12/31/03 1,013,000,000
Pharma rights? 385,000,000
3,383,000,000
Total debt and restructure 3,533,000,000
Elan breakup value 2,353,100,000
Per share value (150 mil sh) 6.72
Per share value with LYONS
discounted by 25 percent 7.45
Per share value without Antegren 3.87
Per share value without Antegren
with LYONS discounted 4.59 |
