SPARTAN STOCKS 300 Exclusive “Stalking Horse” Stock Pick
Chem Rx Corp. (CHRXQ: OTC)
Hey Spartans,
Hope you liked our last pick. If you were onboard with HBWO Monday, you profited up to 122.5% for the day and up 178% since it was alerted here at Spartan Stocks 300.
Be on the lookout for our NEXT HOT PICK for this week: Chem Rx Corp. (CHRXQ). If you’ve been watching this company like we have, you know the bankruptcy play - CHRXQ is ready to make a bounce!
PharMerica Corporation (NYSE: PMC). PMC:NYSE 9.40 files 8K to buy Chem Rx Corp. (CHRXQ: OTC for $70.6 million, and assume all debt!
Chem Rx(CHRXQ) has 13,791,866 shares on record as of August 13, 2008. With a cash offer of $70.6 million for all operations equipment, employees, with all debt being acquired PharMerica, that’s a Cash offer.
Sales price per share details have not yet been released, but when you see words like “stalking horse”, and see a series of SEC forms being filed by both companies it sets off radars. We started digging and everything mentioned here is taken from both of the company’s most recent SEC filings. See links below.
We find it very interested that the only thing not mentioned is the sale price in relation to shares, with a $70.6 million dollar offer, and with zero debt obligations at 13.7Million shares, we did the Math and our eyes got huge too$$$$
To clarify, “a stalking horse” asset purchase agreement refers to an attempt by CHRXQ to test the market in advance of a court-approved auction. The intent is to maximize the value of its assets as part of, or before a bankruptcy court-approved auction process.
We believe ChemRx (CHRXQ) management is attempting to make a swift move here to maximize the value of its assets to obtain a higher buyout offer per share!!
Here’s the basics:
- CHRXQ, headquartered in Long Beach, NY, is the third largest Long Term Care pharmacy in the U.S., and is family operated. CHRXQ currently services all of New York State, New Jersey, Pennsylvania, Florida and Illinois.
- CHRXQ is a huge company that’s been around for more than 40 years and services multiple industries - prescription and non-prescription drugs, intravenous medications, durable medical equipment items and surgical supplies - for more than 67,000 residents.
- CHRXQ filed for Chapter 11 bankruptcy protection in the Delaware District of United States Bankruptcy Court on May 11.
- PharMerica Corporation (NYSE: PMC). PMC:NYSE 9.40 Files a SEC form 8K on September 28, 2010 to acquire the Assets from the Seller for $70,600,000 in cash plus the assumption of specified liabilities related to the Assets.
- PharMerica Corporation (NYSE: PMC). PMC:NYSE 9.40 Files a SEC form 8K on September 28, 2010 .The Company has deposited $3,530,000 into escrow which will be credited to the purchase price on the completion of the acquisition of the Assets.
- To sumerize the 8K PharMerica Corporation (NYSE: PMC). PMC:NYSE 9.40 Agree’s to acquire the Assets for $70,600,000 in cash, and this is huge listen and Assumption of all debt!
Last week Monday, it was announced that CHRXQ had reached “a stalking horse” asset purchase agreement with pharmaceutical services company PharMerica Corporation (NYSE: PMC). The total value of the buyout was $70.6 million.
In the deal PharMerica Corporation (NYSE: PMC). PMC:NYSE 9.40 Files a SEC form 8K on September 28, 2010 to acquire the Assets from the Seller for $70,600,000 in cash plus the assumption of specified liabilities related to the Assets.
To sumerize the 8K PharMerica Corporation (NYSE: PMC). PMC:NYSE 9.40 Agree’s to acquire the Assets for $70,600,000 in cash, and this is huge listen and Assumption of all debt! See current share structure link below!!
To clarify, “a stalking horse” asset purchase agreement refers to an attempt by CHRXQ to test the market in advance of a court-approved auction. The intent is to maximize the value of its assets as part of, or before a bankruptcy court-approved auction process.
While entering a stalking horse offer, CHRXQ can offer bidding protections to PharMerica Corp. before the auction. These incentives enhance the value of the offering for PharMerica which might lead to a better price offer before the auction begins which could benefit CHRXQ.
WHICH IT DID!! When news hit on last Monday, Sept. 27, CHRXQ exploded for high of .17. (a gain of 183% when we alerted at .06). Thursday, Sept. 30, CHRXQ hit a day low of .015, but rocketed up to .07 on Friday, Oct. 1, for a triple digit gain (ALL OF THIS ON VERY LOW VOLUMES)- providing an attractive entry point for Spartan investors.
As of end of trading Monday, CHRXQ crossed the finish line at .04. Now, we expect a good push. The “stalking horse” could in the form of good news that would serve as good sign for CHRXQ.
Take for example in late-July 2009, Telefon AB L.M. Ericsson had won a stalking horse bid to acquire Nortel Networks Corp's CDMA division, for $1.13 billion. And as news trickled in about the acquisition, Nortel responded with a profitable August (up more than 100%).
With low volumes and pending news ahead, it’s best to catch this wave before it starts. When CHRXQ’s “stalking horse” becomes a thoroughbred, you should cross the finish line with some winnable profits!
Please allow yourself to do your due diligence at the company’s website, http://www.chemrx.net/.
Current filings
Company Info
Be on the lookout for Chem Rx Corp. (CHRXQ): OUR NEXT HOT PICK for the week!
Happy trails,
~Spartan~
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