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Biotech / Medical : Shaman Pharmaceuticals has been moving on big, relative, -- Ignore unavailable to you. Want to Upgrade?

To: Old Stock Collector who wrote (817)	1/7/2001 4:58:59 PM
From: JMarcus	Read Replies (1) \| Respond to of 838

OSC, I don't think you can safely make a generalization based upon a single experience with a company that filed a bankruptcy. I'm going to try to get ahold of SHPH's bankruptcy filings. I'll be asking Steven King about the best way to monitor filings in the action. I think Conte will try to use the bankruptcy to do something she couldn't get the stockholders to approve: to allow SHPH to form a private subsidiary and transfer core assets to it. This would be done as part of the plan of reorganization. The bankruptcy court should have the power to approve transfers of assets without shareholder approval. The court's primary obligation is to allow the company to reorganize its business in a way that will maximize the chances of repaying the company's debtors. The best interests of stockholders is a secondary concern of the court. Conte will argue that a private subsidiary, created free and clear of SHPH's messed up balance sheet, could obtain the new capital infusion needed to allow the company to meet its growth objectives and thereby generate the income needed to pay off debtors of SHPH. The return to us existing shareholders will come from the ultimate success of that subsidiary, in which SHPH will retain a substantial percentage interest after selling off a major hunk to the new VC investors. I am not entirely happy about this prospect, because Conte has a habit of selling existing shareholders out cheap. Maybe it will be an advantage to have a judge looking over her shoulder. Dunno. Marc