All eyes remain on Chem Rx {CHRXQ} and PharMercia{PMC: NYSE} as PMS files more SEC filings today.
Chem Rx ran into deep debt by poor management was saved two weeks ago when PharMercia came in and offered to buy them out for 70.6Million cash, and to take all LIABILITY DEBT, that's a cash per share buy out.
What also caught our eye was that both companies have been busy updating all the SEC filings. This deal coin the "Stalking Horse" agreement by the companies is designed to draw in more interest to the Company.
Basically "Stalking Horse" is a term used in a hostile take over. In this case Chem RX is saying we will take this offer, however if we get a better offer then we expect more money leaving the door open for higher offers. Which could lead to a bidding war.
The 8-K filed bu PharMercia is very detailed and impressive, and what we find interesting is the only thing left out is how much this equals per share, a fact left out in an attempt to get a higher value on the Company!
The CEO of Chem RX started this Company over 40 years ago. If they bankrupt he gets nothing, however in the buy out deal, they get a premium dollar for a Bankrupt Company, buying Company takes the debt, and the CEO and all employees keep there jobs.
Shares of PMC have been trading up 15% since the deal was announced.
Stay tuned as this story develops!
Chem Rx Corporation signs "Stalking Horse' Agreement
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