SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Biotech / Medical : ARIAD Pharmaceuticals
ARIA 23.990.0%Feb 17 4:00 PM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Mike McFarland who wrote (361)11/13/1998 11:41:00 AM
From: Biomaven  Read Replies (1) of 4474
 
Mike,

So, how many shares of the common do you get for exchanging a
share of the convertible?

It's not a fixed number. Basically, the "investors" get to convert $5m into as many shares of ARIAD as they can get based on the 4 lowest bid prices in the 22 days preceding the conversion. At least they don't get to convert at a discount, as is sometimes the case.

This is an open invitation for them to short the stock into the ground in the period preceding the conversion, so as to get as many shares as possible. Sometimes the terms prohibit shorting, but usually not.

Either the company is very naive, or they desperately needed the money at any cost.

I can't understand why reputable companies like this don't do a rights offering instead. That way at least only shareholders that don't put up money get diluted.

I like the science here, but I'm pretty firm on staying out of companies that have floorless convertibles like this one.

Peter
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News