Reliance Genemedix Share Discussion Threads

[amarone] 23/2/2004 21:43

Talks with MNC set ablaze demand for GeneMedix

By SERENA NG 19.02.04


(SINGAPORE) The Singapore market's only pure biotechnology stock, GeneMedix plc, yesterday gave an inkling of the huge potential new developments that the pharmaceutical industry could bring when its shares shot up two-thirds in a single day on hopes of a merger with a US giant.




GeneMedix's shares, which had already gained nearly 30 per cent on Tuesday to 56 cents, yesterday jumped to a two-year high of $1.12 in intraday trade before ending at 92 cents, up 36 cents or a hefty 64 per cent.

Some 31.3 million of GeneMedix shares were traded yesterday.

The two-day share surge boosted GeneMedix's market capitalisation to some $275 million, from just $130 million on Monday.

Investor euphoria over the counter was attributable to a Monday announcement by the London and Singapore-listed drugmaker, which had revealed that a 'significant transaction' was being negotiated with an international pharmaceutical products company.

Loss-making GeneMedix, which was responding to recent market speculation, also said the talks 'may or may not lead to a merger between the two companies', adding it had recently indicated it was looking to access the US markets.

Last week, the UK-based biotech firm also announced that it is working with the Bank of New York to establish an American Depository Receipt Programme on Nasdaq.





GeneMedix cited its interest in accessing the US capital markets, which it said have tremendous interest in the emerging field of biogenerics, or generic therapeutic products that are produced through modern biotechnology processes.

While GeneMedix, which makes protein-based drugs, did not name the company it is in talks with, market players concluded that the potential partner was probably an American firm with a sizeable presence.

Bloomberg News also quoted the group's chief financial officer Julian Attfield saying that the talks, though preliminary, are focused on forming a collaborative partnership rather than a takeover by a potential buyer.

GeneMedix's London-listed shares, meanwhile, have also more than doubled since the start of this week.

The company was listed in Singapore on Dec 1, 2000, one day after listing on London, and its initial public offering (IPO) shares had been priced at 90 pence or $2.22.

The stock subsequently hit a high of $3.06 here in February 2001, while its record low of 31.5 cents was seen earlier this month on Feb 2.

Amid yesterday's stunning share price surge, some market players in Singapore reacted with scepticism.

Said one active trader: 'It's a ridiculous price, and my gut feeling is that it's all hyped up. I did not like the fact that the stock ran up for a few days and then the company made its announcement.'

He added that the sharp run-up might lead the other party to pull out, especially if a share swap was being planned.

But for other market watchers, the volatility of GeneMedix's shares was seen as a reflection of the high risk-to-reward factor of biotechnology stocks, as such companies tend to be mired in losses for years before getting a big break.

GeneMedix reported a net loss of 4.8 million (S$15 million) for the nine months to August 2003, versus a net loss of 6.6 million a year ago.

[amarone] 23/2/2004 18:30

Nil. you might like to have a look on www.bio.org/ceo gives a good in-sight into this market, it's high's and low's. Two days of funny business ahead IMHO.
Check out www.sgx.com for the GMX price tomorrow morning - should provide another clue for direction.
DYOR etc.
AMARONE.

[nil pd] 23/2/2004 17:08

Amarone: Volatile! Tell me about it! The market's looking for direction right now. Thursday will provide that.

I believe the company should have suspended trading last week rather than issue conflicting messages and I expect they will have to answer questions about that at the analysts' meeting. Just a little bit of price manipulation going on there. It is now incumbent on them to wrap up the deal as quickly as possible and let the market take it the way it wants.

Of course I have no detail, but my guess is that the current valuation does not fully account for the imminent deal or merger. So I will take the risk to run with these - I think we will see rises each day now.

Nil.

[amarone] 23/2/2004 16:45

Nil Pd - sorry my friend, I'm not. Just had my broker phone me about how volatile these shares are and the fact that he would not entertain a stop loss on them due to this. Just atch this share like a hawk this week - I will be.

AMARONE.

ps. MM drop in some big buys at the hammer - naughty, naughty!

[nil pd] 23/2/2004 16:25

Amarone, are you (like me) in at slightly higher levels than this?

[nmitra] 23/2/2004 16:02

I am very confident that the GMX will have some good news on thursday.

[amarone] 23/2/2004 15:59

nmitra - care to share ? Always facinated by posts like yours.......

AMARONE

[nmitra] 23/2/2004 15:54

GMX will be 30p on thursday

[nil pd] 23/2/2004 15:54

Website same for me Amarone.

[amarone] 23/2/2004 15:52

andyprice5569 - fight the influences of Evil - you know what I mean ? :-))

AMARONE

ps. is it my IP connection or is this website running like a dog today?

[nil pd] 23/2/2004 15:48

Well, let's put it this way Andy, one way will burn you!

Come on now make up your mind..

[andyprice5569] 23/2/2004 15:41

Amerone,

Yup, I maybe should get in again sometime, but am I going to buy or short GMX ?

Hmmmmm.....

;-))

Andy

[amarone] 23/2/2004 15:11

andyprice5569 - reminds me of my dotcom trading days, which biotech is looking more like every day ie. all sentiment/no fundamentals = VERY HIGH RISK. Watch out for maybe 20p today, gotta get in sometime andy!
Cripes, sound like a right ramper - lol.
IMHO
AMARONE.

[andyprice5569] 23/2/2004 14:54

Hi Amarone,

Yup, I agree that sentiment is moving this stock at the moment, but when sentiment changes, fundimentals become more important and one should know what 'fair value' is across the various exchanges, hence, the need to work out whether the UK or the Singapore listing is cheap/expensive.

I guess when they list on the NASDAQ, the $USD valuation will be @ 'X' and when the $ starts to gain against the £ in the coming years, the GMX US stock will 'gain' in value compared to the UK £ listing - something to bear in mind if one is considering being a long term holder.

HTH - Andy

[amarone] 23/2/2004 14:35

andyprice5569 - can see GMX just about holding on to this 2p today. Concerning the delta re:currency exchange etc. good point however, it is sentiment which is driving this share (like most HR/HR shares) and that sentiment is very much in the blue zone. ;-)
IMHO

AMARONE

[nil pd] 23/2/2004 14:35

jgp212 - 26th Feb. Andy, be a little more helpful. Tch, tch! And by the way, your 266, I suggest you look at 'yep' pretty soon.

[jgp212] 23/2/2004 14:33

Andy,

Thanks

I must be as blind as a bat LOL

Good luck

Regards

Jeff

[andyprice5569] 23/2/2004 14:24

jgp212,

I would suggest the answer is in the 'Notice of Results' RNS

HTH - Andy

[jgp212] 23/2/2004 14:20

Hi all

When are GMX reporting?

[andyprice5569] 23/2/2004 14:00

Amarone,

Nope, not yet.

Regs, Andy

[amarone] 23/2/2004 13:48

andyprice5569 - are you getting on board yet ? EK must be putting these in same column as William Hill at the moment! IMHO
AMARONE.

[andyprice5569] 23/2/2004 13:47

Hi Nil Pd,

'Now I wonder what would happen if Singapore traders bought their shares here (for two thirds of the price) instead of locally. Seems like we will be moving toward parity soon.'

What is 'parity'?

Firstly, one has to find out what price GMX opened at on the Singapore stock exchange (the first day of trading);

find out what the GMX UK share price was that day;

find out what the exchange rates (£ and Singapore $) was on the day GMX opened in Singapore;

find out what the exchange rate for the £ and Sing $ is today;

find out the difference.

Currency fluctuations between the £ and the Sing $ will have had an effect on the price of shares in the UK (you think cheap) compared to the price of shares in Singapore (where you think they are dearer).

HTH - Regs,

Andy