Health and Healthcare
Boston Scientific Co-Founders Hit By Margin Calls (BSX)
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Today after the close, SEC Filings have shown that Boston Scientific Corp. (NYSE: BSX) co-founders have been forced to sell more common stock to meet margin calls. Unfortunately this isn’t the first pony ride on margin calls, and if the market continues on this path it is hard to imagine that more calls won’t result in forced share sales.
Chairman Peter Nicholas sold 50,344 shares of common stock for grossproceeds of roughly $7.57 million, while Director John Abele was forcedto unload 634,200 shares of common stock for roughly $5.64 millionbefore fees. Nicholas still has 15.3 million direct shares and hasover 35.2 million in a limited partnership and 2.4 million shares in atrust. Abele still has some 37.1 million shares of direct ownershipand another 751,000+ shares held by his spouse and in trust.
It appears that the co-founders have been hit with more than one margincall and the belief had been that other margin calls would not benecessary. These forced sales are now running well into six-digit figures.
The company’s logo says "Delivering What’s Next." It sounds like the company’s founders have to either deliver more shares or more cash to stay in the game.
This medical equipment stock closed down $0.43 today at $8.19 and its 52-week low from two-weeks ago was listed as $6.34.
Jon C. Ogg
October 22, 2008
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