According to Morgan Stanley, the cutoff date to tender your shares in the scPharma ($SCPH) acquisition is October 3rd, 3 days before the October 6th expiration date.
Effectively, your options are to tender and receive $5.35 in cash plus the contingent value right (CVR) I’ve written about and explained in previous posts….or…..to sell your shares prior to the tender date.
I have tendered my shares and intend to have approximately a 2% position in the CVR. I think it’s likely we receive the full $1.00 in value from the CVR in the next 5 quarters and we’re paying a low price for that. Please note that there is no guarantee of receiving any value from the CVR and it could turn out to be worth zero. I also remind you that the CVR will not trade. Once you have made the decision to own it, you will own it until you receive cash or it expires worthless in mid 2027.
If you want the current $5.62 market price instead of $5.35 in cash plus the CVR, you can sell your stock now.
If you want to tender, and you’re not sure of the process, please call your brokerage firm or advisor where your shares are held. They will be able to help you with the process. I have received several questions on this and while I will be as helpful as possible, I won’t know the specific process required at your brokerage firm.
My decision is to tender and own the CVR at an implied current price of $.27 ($5.62 – $5.35). If you just want the higher amount of cash now, there is nothing wrong with selling your stock. If that’s your decision, please sell your stock this month (September).
Again, credit to Dr. Paul Thompson, cardiologist and member of the DKI Board of Advisors. He suggested both $SWAV where we earned a 70% return to a takeover and $SCPH where we made approximately a 50% return assuming we get the full value of the CVR.
To the free subscribers reading this: I’ve chosen to not paywall this post because this deal is a complicated and tenders can be tricky if you don’t know the procedure. If you see the value in how we’re helping our premium subscribers make money, please consider subscribing at: https://deepknowledgeinvesting.com/subscribe-now/
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