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

To: bob zagorin who wrote (25828)	9/29/1998 2:37:00 PM
From: growthvalue	Read Replies (2) \| Respond to of 32384

My quick take is why in the world are they giving away 8% of the company (increasing the shares outstanding by 8.7%) for a morphine pill? Moreover, they may have even given away 15% of the company, eventually increasing the shares outstanding by 17.6%, diluting existing shareholders' stake in the company by 15%. Elan could end up owning 15% of the company and all Ligand gets is a morphine pill, an expensive infusion of cash paid for by more dilution. How does this benefit me as a shareholder?? I think we would all be better off today if Ligand had just focused on Panretin and Targretin. Robinson indicates that this "further diversif(ies) our commercial risk" - no doubt, but at what expense? Ligand could double the shares outstanding, selling at $14, and would significantly diversify its commercial risk but that would cut shareholders' stake of the company in half. Would that be that worthwhile? Does Ligand not believe in the viability of its technology platform that it has to "diversify" away from it? Are they worried that Targretin and/or Panretin will fail? Then why does this deal make ANY sense? GV