Just a brief news post, I'll use the comment section to update my thoughts as this situation develops.  Last night, 8/6, Pershing Square (37.5% owner) updated their 13D in Howard Hughes (HHH) ($3.2B market cap) disclosing the following change: “The Reporting Persons are and intend to continue evaluating the possibility of various potential alternatives with respect to their investment in the Issuer, including a possible transaction in which the Reporting Persons and/or one or more of their affiliates (either alone or together with one or more potential co-investors) may acquire all ..read more

** Note, I'm a little late in posting my mid-year review as I was unplugged a bit for the last couple weeks.  Back dating the post to its usual spot.**   My blog portfolio is essentially flat year-to-date with a gain of 2.99%, well behind the S&P 500 with a gain of 15.29%.  The broken biotech basket performed well but was generally offset by declines in a lot of my legacy holdings and just malaise in my speculative M&A ideas (crossing my fingers that M&A picks up in the second half).  Long term performance remains solid at a 21.75% pre-tax IRR. Closed Posi ..read more

Vanda Pharmaceuticals (VNDA) (~$365MM market cap) is a biopharma company with a number of drugs either already being commercialized, on the cusp of commercialization or in late stage trials.  I have no idea if any of these are valuable franchises (as always, if you have any insights, please share them): Hetlioz -- commercial treatment for the treatment of Non-24-Hour Sleep-Wake Disorder in the U.S., it is facing generic competition as of December 2022 and has a few legal battles in its attempt to get additional approved indications Fanapt -- recently approved for biopolar disorder, launc ..read more

The broken biotech basket has been emptying out lately, but the latest addition is Ikena Oncology (IKNA) (~$75MM market cap), a clinical stage biotechnology targeting cancer therapies, that announced yesterday they are shuttering development on their most advanced therapy candidate, IK-930, reducing their workforce by 53% (they previously did a 35% layoff in January) and will pursue strategic alternatives.  Notably this isn't a full stop of development, Ikena does have another asset (IK-595) that dosed its first Phase 1 patient in December 2023.  But Ikena does a nice job of itemizin ..read more

Inhibrx Inc (INBX) (~$1.8B market cap) is a clinical stage biotech that announced the sale of their most advanced therapy, INBRX-101 (a treatment for patients with alpha-1 antitrypsin deficiency or "AATD"), in January to Sanofi (SNY) for $30/share in cash, plus 92% ownership in the remaining development pipeline via a taxable spin of NewCo Inhibrx Biosciences (SNY to retain the other 8%) and a $5/share CVR that pays out if INBRX-101 receives final FDA approval prior to 6/30/2027.  INBX shares trade for $34.20 today -- all approvals have been received and the merger will close 5/30/24. The ..read more

Enhabit (EHAB) ($413MM market cap) is a July 2022 spinoff of Encompass Health (EHC) that provides home health and hospice care.  Similar to many recent spinoffs, Encompass Health loaded Enhabit up with debt and dividended back the proceeds to themselves, as is also typical recently, Enhabit ran into business headwinds shortly after being spun and the stock price has suffered since.  Activists showed up pretty quickly here demanding a sale as the home health and hospice care industry has been consolidating with Enhabit being one of the few remaining standalone public companies in the ..read more

Andrew Walker recently had Matt Turk on his podcast where they discussed this idea.  I generally agree, but for my own process, I wanted to write out my thoughts as well. Target Hospitality (TH) ($1.2B market cap) is a provider of mobile temporary housing (previously colloquially called "man camps") that historically focused on the energy exploration sector (about 1/4 of their business today) but over the last decade, and mostly in the last few years, TH has moved into the business of housing migrants crossing the U.S. southern border.  Their largest contract is an influx care f ..read more

Similar to MRDB, this is pretty speculative.  Asensus Surgical (ASXC) (~$73MM market cap) is a cash burning medical device company that makes robot systems for abdominal surgeries.  Asensus has one surgical system in the market (Senhance Surgical System) and a next generation one in development (LUNA System), unfortunately for the company, they're reaching the end of their cash runway in June, per their own forecast, leaving them in a tricky spot needing to raise capital. In comes Karl Storz SE, a privately held but sizable German medical device company, with a letter of intent to pu ..read more

This is highly speculative, but I wanted to bring the discussion out of the comment sections of my BFIN post as I found the situation interesting enough to initiate a small position. MariaDB plc (MRDB) ($32MM market cap) offers enterprise and premium functionality on top of the open sourced (free) MariaDB Community Server database management system ("DMBS").  To distinguish between the company and the open sourced DMBS, I'll refer to the for-profit company itself as MRDB and the DMBS as MariaDB.  The lead developer of MariaDB is Michael "Monty" Widenius who was one of the original de ..read more

James River Group Holdings (JRVR) is a small (~$295MM market cap) insurer primarily focused on small and middle market casualty risk in the U.S. excess and surplus ("E&S") market.  The E&S market can be an attractive market segment because it doesn't face the same regulatory constraints as the admitted (regulated) market, potential clients typically have to demonstrate they can't get regular policies before entering the E&S market where pricing and policies can be more bespoke (and profitable).  James River is relatively good at underwriting these risks, they've had some ..read more