After the jackpot, the bet
https://www.lapresse.ca/affaires/entreprises/2022-06-15/apres-le-pactole-le-pari.php
With a gain of 100 million from Cominar, businessman George Armoyan acquires 10% of Knight Therapeutics
After making a profit of nearly $100 million in less than two years with Cominar during the pandemic, Montreal businessman George Armoyan is turning his attention to another Quebec company.
This time, he paid tens of millions to buy shares in Knight Therapeutics, a Montreal pharmaceutical company.
The 10% stake in Knight that he just declared to regulators is worth about sixty million dollars at current stock prices.
The entrepreneur and investor who has dealt with real estate as well as transport and energy over the years has thus become one of the largest shareholders of Knight, behind in particular the founder and executive chairman of the board of business, Jonathan Goodman.
“I really like the leaders. This is one of the best teams of managers I have ever met. I’m convinced they’re going to make me money,” George Armoyan said over the phone, referring to Jonathan Goodman and Knight CEO Samira Sakhia.
“I have nothing but admiration for these people, the complete opposite of Cominar,” he says, unable to help but criticize the management of the Quebec real estate investment fund.
However, Cominar made him realize an impressive flash profit. “Nearly 100 million,” he says half-heartedly, when we insist that he quantify his gain. “One of the five best investments of my career,” says this Armenian born in Syria.
George Armoyan hesitated for a long time last year before lining up behind the buyout offer aimed at closing Cominar’s capital. Having quickly become the largest holder of shares with a stake greater than 10%, he started buying Cominar shares at the start of the pandemic in 2020. He had a good guess in buying when the value of the share had greatly depreciated on the stock market and was hovering around $7.
PHOTO ANDRÉ PICHETTE, LA PRESSE ARCHIVES
Jonathan Goodman, founder and executive chairman of Knight Therapeutics
A non-conformist investor with a reputation as an activist, George Armoyan said he saw in Cominar a stock significantly undervalued in relation to the net asset value and a real estate portfolio containing strong potential. He has never hidden the fact that he was surprised that Cominar closed its capital by accepting an offer which according to him was “at a discount”.
The closure of the capital carried out at the unit price of $11.75 nevertheless allowed George Armoyan to make a significant gain in a relatively short time.
A good CA
Mr. Armoyan says he started accumulating Knight shares shortly before Christmas. The adopted Montrealer says he does not want a seat on Knight’s board of directors, at least for the moment.
» Maybe one day, but I don’t need to be on the board if I don’t think I can contribute. The Knight board is very good and impresses me. I know little about this sector of activity. But I will be in constant dialogue with management and I will learn,” he says.
George Armoyan adds that Jonathan Goodman does not work out of need for money. “He believes in the company and wants it to achieve success similar to that of Paladin Laboratories. »
Before founding Knight in 2014, Jonathan Goodman co-founded and directed Paladin Laboratories, a pharmaceutical company bought by Endo Health in 2013 for 3.2 billion.
“Knight’s management just needs to keep doing what they’re doing and I’ll be happy. Leaders do everything the right way. » –George Armoyan
Knight’s business model is based on the licensing of distribution rights for medical products intended for the Canadian market and selected international markets.
» People get sick and need medicine. Knight has the platform and know-how to establish itself in smaller markets neglected by big pharmaceuticals. Knight focuses his efforts in Canada and Latin America,” says George Armoyan.
Knight was the subject of a circular battle in 2019. That year, shareholders were asked to choose between the directors suggested by Knight or those proposed by a dissident and disappointed ex-director and shareholder who criticized in particular Knight to sit on her cash.
Jonathan Goodman said at the time that if he lost the vote, he would resign immediately and sell his shares as quickly as possible. Knight notably reminded shareholders, at the time of the vote, that the company was on the right track and was doing its best by “patiently” executing a strategy whose effectiveness had been demonstrated by Jonathan Goodman at Paladin.
Knight’s stock is currently very close to its floor price. The stock closed at $5.07 on Tuesday on the Toronto Stock Exchange. It was worth over $10 in 2017.
