I’ve stated previously on this forum that it’s my strong belief that BP has not invested in PO3 and joined the board as a way to pass his later years. Parfet is business royalty in the US – a billionaire with a track record of serial success in contributing to the building of multi-billion dollar corporations.
Consequently, I thought I’d take a look at when he became involved in some of his companies, where they were capitalised at the time of his joining the board, and where they were capitalised when he ceased formal involvement with those companies. For the purpose of this exercise, I will exclude Pharmacia & Upjohn, as this was BP’s family company (at least the Upjohn was prior to merging with Pharmacia in 1995 and then being acquired by Pfizer for about USD60bn in 2002. And for what it’s worth, $60bn in 2002 is worth just a little more in 2019 dollars.).
The 2 companies that I’ll analyse to the best of my ability are Stryker Corporation (SYK:NYSE) and Monsanto.
According to the following link Parfet Bio ,
Parfet joined the SYK board in 1993 before resigning in August, 2016. I couldn’t find the exact date when he joined.
If this is correct, BP joined the board of SYK when it had a market cap of about USD140m. When he resigned in 2016, SYK was capped at USD45bn. This is a 321x increase in cap and doesn’t include dividends. Today, SYK is capped at closer to USD70bn.
Sourcing historical data for Monsanto is more difficult given that they are no longer a standalone entity following their USD63.5bn acquisition by Bayer. It seems as though a lot of historical information has been wiped from the Net and I can only cobble together bits and pieces to the best of my limited resources. I believe the following link is quite helpful: Motley Fool - Monsanto
In short, as taken from the link: In 1999, Monsanto entered into a merger agreement with Pharmacia & Upjohn, Inc., with the surviving company being named Pharmacia. The merger closed in early 2000, but by late 2000, the combined company separated out its agricultural operations and did an IPO of the new Monsanto, offering 15% of the unit's shares. In 2002, the company followed up with a full spinoff of Monsanto, and Pfizer acquired Pharmacia shortly thereafter.
Pretty damn savvy whoever thought of that. Would anyone be bold enough to suggest this guy does not have first class global business credentials; and as the saying goes, he has a Ph.D. in results!
Parfet joined Monsanto in June 2000 when the stock was around USD12.50 and resigned in August 2016 when the stock was around USD90 – a 720% increase. This doesn’t include dividends. The company was eventually acquired at USD128/share. This equates to a 10x return from when BP first became involved not including dividends.
I simply can’t reconstruct the market cap of Monsanto from 2000, however it’s very possible it was sub-$1bn at the time of BP’s involvement. If anyone out there can help fully reconstruct this story from inception with accurate numbers, I’d be appreciative.
Notice the declining issued cap? I don’t think BP is a great fan of dilution. That augurs well for PO3 shareholders.
To summarise, we are VERY FORTUNATE to have BP on board both as an investor and director.
The recent appointment of the highly credentialed and regarded JH to PO3 is evidence that BP is very engaged in PO3 and not a passive investor.
That JH would agree to join PO3 is further testament to the potential of the FRG tech and the company as a whole. No doubt JH has completed his own deep DD before agreeing to come on board, so his appointment is further validation of the tech.
Remember BP’s quote from the announcement back in November (my bolding): Mr Parfet stated today that: “We have conducted due diligence on Somnio and its range of technologies for some time and we are impressed with the disruptive nature of the FRG technology platform. An investment into Purifloh to execute on its potential was logical. That the technology has been developed in Michigan and has global impact only adds to our attraction.”
The nexus between BP, JH and Stryker is obviously very strong and will stand PO3 in good stead as it advances negotiations with OEMs.
BP has become involved with PO3 at the microcap stage and he’s used to turning companies into behemoths. Not 10 or 20-baggers, but hundreds of baggers. I’m willing to bet that he sees PO3 as another enormous winner for him.
We are on a GIANT winner here just riding the coattails of BP and I can genuinely understand why PO3 management couldn’t give a rat’s about the day to day movements in the share price. Genuine company builders rarely do.
PO3 Price at posting:
$3.42 Sentiment: Buy Disclosure: Held
(20min delay)
