MBP 3.23% 3.0¢ metabolic pharmaceuticals limited


  1. 4,891 Posts.
    lightbulb Created with Sketch. 148
    The DMR Corporate independent expert's report has just been sent round by Metabolic as support for the acquisition resolutions to be voted on at the upcoming AGM.

    DMR values the merged Metabolic/Polynovo company (high end valuation) at $43,460,000. This includes residual value from Metabolic's cash position and present value of future cash flows from the Polynovo deals with Medtronic, Biomet, and Smith & Nephew. It does not include any expectation of value flowing from Polynovo's Novoskin or Novofill research, or any other potential application of Polynovo technology, and as such is rather conservative.

    It also undervalues the cash flows for the three existing deals because the valuations were done before the major part of the devaluation of the Australian Dollar against the US Dollar. I estimate this undervaluing to be in the neighborhood of 30%.

    At current exchange rates, using the same assumptions as DMR, I calculate the value of the merged company at $50,960,000.

    The diluted share value, assuming that the market capitalization should mirror the company's value, might fairly range between $.08/share (DMR valuation) and $.095/share (my adjusted DMR valuation).

    In fact, I think that long term the share price should be a multiple of this immeidate estimation.

    I believe that currently MBP is significantly undervalued in the market and represents an opportunity for signifcant share price appreciation over the medium term.
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.