Biotech biomedical holdings, which owns a large number of Israeli biotech companies in various stages of development, announced that it plans to buy back its shares held by pontifex in exchange for shares of nsawax. this acquisition is part of pontifex's move to liquidate its holdings in bio medics in exchange for some of its subsidiaries.

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It should be noted which companies chose pontifex, its venture capital fund for return on investment from the best in the market, to leave in its portfolio after the implementation of the move. we will examine the move from several angles, as an example of analyzing a transaction according to public company announcements to the tase only, and without access to the management of the companies.

It should be noted that pontifex is a private company, which usually maintains a negligible internet presence, and operates mainly behind the scenes of the industry. however, it is possible to learn about its activities in public companies by analyzing their announcements to the tase and to draw important information from there to the investor in the bio shares.

Pontifex began to have an interest in biomedical in September 2005, biomedical reports to the stock exchange. since then, pontifex has made a number of investments in biomedically controlled companies, including nsawax and valium. however, pontifex recently began a move to exit its investments in biomedical. however, this move is not a cash intermediary, but rather a share swap. we will look at these transactions from pontifex's point of view, and see how the investor can derive value from their analysis.

Pontifex invests in biotech company alum

As part of the move against bio medics, pontifex began to have an interest in alum, which manufactures stents for various organs in the body, with an emphasis on the bile and urinary tract. attention to the companies of beeswax valium, which are held by biomedicine, following pontifex activity competitive advantage of alum's product is that the stents are specific to each organ, and therefore should be easier to insert and retrieve in the cyclamin as well as more effective in maintaining fluid flow in the organ.

Alum's marketing strategy led her recently (January 2012) to announce the purchase of Guardia, which developed products to protect against various types of embolisms, a possible Louis phenomenon in the catapulting process, due to the strong synergy between the products. it should be emphasized that alum is a mature company, with a number of products that have already received distribution approval in Europe.

Pontifex will receive shares of swax in exchange for all of its biomedical shares

Recently, bio medics announced that it would buy back its shares from pontifex. the proceeds will be shared, according to a formula that weights the cash value of the shares of the two companies at an average rate of 60 trading days. thus, biomedical will acquire approximately 17.5 million of its shares and liquidate its options held by pontifex for approximately 4.5 million shares of nsawax, which constitutes about a third of biomedical holdings and its subsidiaries (subject to court approval).

Pontifex, which ceased to have an interest in beeswax in May 2009, will hold about 11 percent of neswax's repaid fortune and will become a stakeholder in the company again. nsawax is a young biotech company in the field of immunology, most of whose Paypal is in the very early stages of development. choosing a young company undermines the hypothesis that pontifex's move is intended to reduce risk and invest only in mature companies.

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In addition, alum is a biotech company that manufactures an artificial product, and vanswax is a BioMed company that produces a biological molecule. this undermines the hypothesis that the move is part of pontifex's investment strategy in a specific field. we have nowhere to assume that the investment in these companies is due to the very activity of the companies, and not as a secondary effect to an investment strategy. nsawax, and its announcement of success in a phase a2 clinical trial have previously been reviewed on the site.

What does pontifex's acquisition of beeswax and ballium holdings signal to investors?

Usually, when a company buys back its shares (Repurchase), this is a signal to the market about the owner's belief in the company (due to the private information they have), and it is not necessary to mention the massive wave of repurchases that occurred around the beginning of 2009 and the return recorded in these shares since then.

However, in Danan's case, it is a purchase from a single strategic investor, in exchange for shares and not cash, conducted as part of a long-term move by Pontifex. These factors undermine the intensity of the signal. However, this move is complex, since Pontifex may have wanted to reduce leverage in the framework of risk management, and move to hold directly to the subsidiaries. Does this still have any information for the investor?

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Ostensibly, the answer is yes. Pontifex is one of the most professional funds in the market. The company's third fund recently raised $88 million from leading figures in the Biomed market, including the late Eli Horowitz, Michael Sela, and Ruth Arnon, the developers of Copaxone from the Weizmann Institute. In a historical review, it is evident that the Fund has displayed high returns over the years. In our assessment, her choice to preserve Nsawax and Alum in her portfolio, out of the entire biomedical portfolio, after the end of its ties to the company, signals to the market a strong belief in these companies. Using a formula that compares the shekel value of the acquired shares and the proceeds for them (NPV = 0) and

Conclusion

It is suggested that investors closely monitor what is happening in alium and NSW. the two companies differ in maturity, category (medical devices versus antibodies), and in their business conduct, but both will form part of pontifex's portfolio for the coming year, which has chosen them from a variety of biomedical holding companies. in addition, it is proposed to pay attention to the announcements of public companies to the tase even when they do not report regulatory activity (such as successes in clinical trials) but on the activities of stakeholders, since it is possible through them to learn about important moves in the biotech market in Israel.