May 24
Human Genome Sciences, Inc. (“HSG”), a biopharmaceutical company targeted for acquisition by GlaxoSmithKline (“GSK”), has adopted a defensive position commonly known as a “poison pill”. HSG is apparently unimpressed with GSK’s $13 cash per share ($2.6 billion) offer and has approved a Shareholder’s Rights Plan whose intention is to make the takeover uneconomical for GSK. …
Permanent link to this article: https://betweenthenumbers.net/2012/05/attempted-biopharmaceutical-takeover-turns-toxic/
Apr 18
AOL recently announced the sale of over 800 patents and patent applications to Microsoft, and a non-exclusive license covering the rest of its retained patent portfolio. The sale price is $1.056 billion in cash. The sale includes the stock of an AOL subsidiary, which allows AOL to offset the patent sales against a loss involving …
Permanent link to this article: https://betweenthenumbers.net/2012/04/aol-surprise-sale-shows-the-value-of-mapping-technology/
Jan 31
When used with financial instruments, options are a contract between two parties in which one party has the right, but not the obligation, to do something. Usually, the option involves buying or selling an underlying asset. Having rights without obligations has financial value, so option holders must purchase these rights at a price, called a …
Permanent link to this article: https://betweenthenumbers.net/2012/01/a-primer-on-valuing-options/
Jan 06
Ernst & Young (E&Y) recently released a study of the annual recurring costs of going public. Most studies on this topic focus on sales commissions and discounts paid to investment bankers. The other costs of going public are often not available, and are minimized by some commentators. E&Y sheds light on this important subject, generally …
Permanent link to this article: https://betweenthenumbers.net/2012/01/new-study-shows-high-annual-costs-of-being-a-public-company/
Dec 15
For the first time ever, the cost of the gifts featured in the Christmas carol, “Twelve Days of Christmas,” totals more than $100,000. Financial services company, PNC Wealth Management, just released its 28th annual estimate of the “Christmas price index”, a whimsical economic indicator that tallies the prices of the following basket of Christmas gifts …
Permanent link to this article: https://betweenthenumbers.net/2011/12/the-12-days-of-christmas-a-lesson-in-how-a-complex-appraisal-can-go-astray/
Nov 25
When a minority interest in a privately-held company is transferred, a discount from the value of the entire company is calculated to reflect the lack of marketability of such an interest. These discounts for lack of marketability (DLOMs) are important in many estate plans and related transfers. In August, 2011, the IRS publicly released a lengthy practice …
Permanent link to this article: https://betweenthenumbers.net/2011/11/irs-marketability-practice-aid-falls-far-short-of-its-potential/
Nov 09
The Groupon IPO finally occurred. At least for the moment, the insiders are looking smart for rejecting Google’s six billion dollar offer for the local deals coupon site. The initial day’s trading set the market capitalization of the firm at over twice that. So it is either going to be the next Amazon or the next …
Permanent link to this article: https://betweenthenumbers.net/2011/11/groupon-valuation-pluses-and-minuses/
Sep 29
The Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2011-08, entitled “Testing Goodwill for Impairment”. This amends guidance in Generally Accepted Accounting Principles (GAAP) Topic 350 involving goodwill and other intangible assets. Because early adoption is allowed, and the new guidance simplifies significantly the current procedures, expect the new guidance to be widely implemented …
Permanent link to this article: https://betweenthenumbers.net/2011/09/goodwill-impairment-tests-become-easier/
Aug 11
Since Bob Dylan is still singing (or something like that), he might want to dig up his early hit “Blowin’ in the Wind” and add a new line. Something to the effect of “How many foreclosures will it take ‘til banks consider other appraisal methods.” I’ll let Mr. Dylan worry about making the line sound …
Permanent link to this article: https://betweenthenumbers.net/2011/08/time-to-consider-other-appraisal-methods-answer-is-blowin%e2%80%99-in-the-wind/
Jul 19
Nortel’s patent portfolio was recently auctioned. The final cash price is a surprisingly high $4.5 billion for around 6000 patents and patent applications. The auction process and participants are described in this article. Nortel described the package as: … more than 6,000 patents and patent applications [covering] wireless, wireless 4G, data networking, optical, voice, Internet, …
Permanent link to this article: https://betweenthenumbers.net/2011/07/nortel-bankruptcy-patent-auction-is-biggest-technology-patent-sale-ever/
