Nabi stockholders receive letter from Mangrove Partners
Mangrove Partners has called on fellow Nabi stockholders to reject a possible merger.
Negotiation strategies are in full flow at Nabi Biopharmaceuticals, as one of its largest stockholders has urged others with shares in the company to reject a merger.
The Mangroves Partners Fund delivered a letter to Nabi stockholders in an effort to get them to turn down a takeover deal with Melbourne-based Biota Holdings.
In the letter, Mangrove stated the transaction would result in loss of value, with the company estimating stocks to be worth around $2.40 (£1.53) per share.
Other concerns listed by the firm included Biota's lack of financial strength - with the organisation operating at a loss for the last two years - and an uncertain management structure.
Mangrove, which provides investment advice on specialised hedge funds, claimed the merger was being completed in order to give Nabi executives more lucrative bonuses and leadership positions.
"It seems clear to us that the proposed transaction has no merit and destroys value for both Nabi and Biota stockholders," the letter explained.
Posted by Edel Quinn
Source: Mangrove press release, August 16th