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Biotech / Medical : Ligand (LGND) Breakout! -- Ignore unavailable to you. Want to Upgrade?

To: Andrew H who wrote (12256)	12/8/1997 2:04:00 PM
From: tonyt	Read Replies (1) \| Respond to of 32384

> This poster never has anything meaningful to say Now, isn't that 'the pot calling the kettle black'

To: Andrew H who wrote (12256)	12/8/1997 2:35:00 PM
From: Henry Niman	Read Replies (1) \| Respond to of 32384

Andy, Speaking of sad stories, Farallon has made out like bandits and LGND's price has been artificially depressed as a result. To review, it was possible to set up an arbitrage position by buying ALRIZ and shorting 1/2 the number of LGND shares. The shorted shares would be covered by the 2 LGNDW contained in each ALRIZ. This covering the short position would not requiring buying any LGND. These shares would come from the exercising the LGNDW. Then when LGND elected to call ALRI with mostly stock, the arbitrage had an over supply of LGND. Instead of needing to exercise the LGNDW, 1/2 of the short position could be covered with the new LGND, which is what Farallon did on Friday. They covered 1/2 of their short position and were given enough cash to exercise 1/2 of their LGNDW which could be used to cover the other 1/2 of their short postion, leaving them with about 1.5 million LGNDW, which is their profit.