Unigene Laboratories (OTC:UGNE) saw its share price decrease by 1.10% on Friday falling from $0.91 $to $0.90. Meanwhile, the volume jumped much higher than the 90-day average. The total amount of traded shares reached half a million.
While not an all-time record, the volume bulged significantly, indicating some excitement in the investing masses. According to the intraday chart, the bulk of the traded volume was turned over at a time. Shortly before 11am yesterday 497 thousand shares were sold at once, indicating that the spike of UGNE was caused by a single major investor.[BANNER]
Most likely the entity behind the trade wanted to get the gain on the luring 12% appreciation of UGNE stock last week. In this case, the clue to the stock action can be traced in the company’s history of convertible stock issuance.
The official reports of UGNE indicate that last year the company issued to Victory Park $33 million in convertible, notes which are due in 2013. The report also says that “as of March 17, 2011, these notes will be convertible into shares of Common Stock at the holder’s option”.
A change in the company’s control was also suggested in case the conversion takes place. Victory Park can acquire 41% of the outstanding shares if it exercises the conversion. Therefore, it seems that the threat of dilution will loom over and influence the trades of UGNE in the near future.
