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Biotech / Medical : Biotech Valuation -- Ignore unavailable to you. Want to Upgrade?

To: Biomaven who wrote (32872)	11/11/2009 2:50:52 PM
From: Ian@SI	Respond to of 52153

Comment and cartoon: If my memory is accurate, CNR had a deal to buy BNI a few years ago, but gave up when antitrust objections couldn't be reasonably resolved. It's not inconceivable that another bid might come in, but it really does look as if there's a lot of low risk money sitting on the table.

To: Biomaven who wrote (32872)	11/11/2009 3:06:55 PM
From: kenhott	Read Replies (1) \| Respond to of 52153

OT- I am not sure I would assume that the call holders would get only cash. At $100, you are sitting right on top of the price which creates some uncertainty about how the end game could play out re: options. For instance, someone COULD (not saying would) exercise their $100 calls just to get Berk-A shares which might force the short call holder to find shares at a squeeze. I would suggest higher strikes, $105 or $110, but maybe that is just personal style. I don't think anyone will come over Berk and raise the bid. I don't think Buffet will raise the bid in this environment. I don't think BNI will reject the bid. But that is just my thinking. The market thinks otherwise.

To: Biomaven who wrote (32872)	11/12/2009 6:35:19 AM
From: Robohogs	Read Replies (2) \| Respond to of 52153

I don't think the result will have anything to do with what others elect, necessarily. What I think I remember seeing in other cases like this is that the CBOE will take a look at the end mix of "stuff" and will change delivery to that mix of stuff so in this case a bunch of cash and some stock. The option will live on and have special delivery. Additionally, there may be some pressure for someone to exercise against you and go get the mix depending on how things go. One would have to check the vol assumptions then as the juice would be cut to 40% of old option. Jon