Tuesday, December 31, 2013

Sold Genzyme CVRs

I sold out my position in the Genzyme Contingent Value Rights (Ticker: GCVRZ) today at $0.33 generating a nice loss of 86%. I received these shares in 2011 from the acquisition of Genzyme by Sanofi. I was waiting until the very end with the small hope that the FDA will approve Lemtrada, but that was not the case. This position made up ~ 2.8% of my portfolio so it was a small hit. The best case scenario remaining for these CVRs is hitting the $400 million in sales for a $2.00 payout. This is possible, but it will be a big challenge to achieve this milestone without US approval. The highest numbers I’ve seen is $500 million in ex US peak sales and that is looking out several years.

I built up my position in RDA Microelectronics, Inc. (Ticker: RDA) by selling some more of the June 2014 $17.50 Puts for $0.35. I have a decent position and now it’s just waiting for the PRC approval. This should be a relatively straight forward regulatory process as this merger may not require the approval from the National Development and Reform Commission (NDRC) based on new rules that was recently announced. Just need the approval from MOFCOM.


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