Prescott Group Capital Management Provides Update on Its Discussions with PharmAthene

Phil Frohlich‘s Prescott Group Capital Management, has provided, in a newly amended filing with the Securities and Exchange Commission, an update on its negotiations with the board of PharmAthene, Inc. (NYSEMKT:PIP) regarding a shareholders meeting proposal launched by Prescott regarding the company’s merger with Theraclone Sciences.

According to the filing, the board declined both proposals for a meeting, stating that the fund should have submitted a statement with the SEC regarding the meeting 30 days before the planned date. In this way, the meeting can only be conducted after the December 3, the date at which the shareholders of PharmAthene will vote in favor or against the merger. At the same time, Prescott stated that the board mentioned that it does not desire to engage in discussions proposed by the fund. Taking into account the board’s position, the meeting will have no effect regarding the merger. According to the previous letter, Prescott requested a meeting to be held on November 29.

Prescott disclosed holding a 10% stake in the company over a month ago. PharmAthene and Theraclone announced about entering into a merger agreement under an all-stock deal at the beginning of August. As stated earlier, the shareholders of the company will vote the matter at the beginning of December. Under the terms of the agreement, Theraclone shareholders will receive shares issued by Pharmathene in such a way that their proportion will amount to 50% of the stock of the new company.

In the latest round of 13F filings, Jim Simons‘ Renaissance Technologies disclosed initiating a small position in the company, which contains 146,000 shares, worth $307,000. At the same time, Ken Griffin‘s Citadel Investment Group closed its option positions, and Sophrosyne Capital, led by Benjamin J Taylor sold of its long stake in the company, which earlier contained around 804,900 shares.

Disclosure: none

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