Charles Jillings, CEO of Utilico, energized by strong economic momentum across Latin America. Watch the video here.
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Well, Shell is listed on the FTSE and has its HQ in the UK having left NL for tax reasons. Our ConLab government could impose an extra special corporation tax of 100pc on the holding entities of evil oil companies.
I agree that Shell NS assets might be a good fit for enlarged SQZ alongside ex-Shell Tailwind assets. Wouldn't be surprised.
Think we just have to wait for the merged accounts to be produced to work out what did or didn’t happen. Accrued cash over 2022 ‘should’ not leave TW as a dividend or other leakage. I doubt one will ever be able to fully attribute these various items unless the notes accompanying merged accounts are unusually transparent.
Probably still trying to work out what the hell they have done with this deal and what it means in reality
haha Dennis, you didnt fall for that old chestnut did you :-)
Anyway good to see us re rating to the £2.50 mark :-(
DTP,
"drive them out of the UK..."
Well, they are well on the way to doing that. Shell only have ~5% of their production in UK waters ... that will soon be ZERO by the look of it, with BP / Cnooc / Exxon etc following closely behind. Big players are not interested in marginal fields, with UK tax rate all NS fields have now become marginal !!!
I know I said BP assets will most likely be targeted by Mercuira ( opss ) sorry Serica, Shell maybe too, with opening its NS data-room last month, offers are expected to be in April.
https://www.rigzone.com/news/wire/shell_selling_stakes_in_uk_north_sea_oil_fields-27-nov-2022-171172-article/
aimo & dyor
They can't tax overseas earnings so all they can do is increase UK taxes and drive them out of the UK. That will be their plan.
"EPS estimate also fell from UK£1.07 per share to UK£0.852 per share."
Since the deal is claimed to be accretive, we should see EPS increasing going forward.
More Ammunition for Labour, BBC et al ....
"Shell sets new record as annual profits more than double to $40bn .." of course all £68.1bn profit will be glossed over as being World wide ..... these headwinds are more of a Category 6 hurricane ... !!!
https://uk.finance.yahoo.com/news/shell-profits-soar-53-record-073056496.html
BB,
"It's well hidden at the moment..."
Agree, no matter how it's dressed up or what part of the deal you look at, there are questions to be asked, with very little in the way of positivity in return. Mr Market thinks the same too ! God, this had better be the precursor to major re-rate Mitch.
aimo & dyor
Norma that cash was paid in full on 12th January 2022 as a dividend to yes you've guessed Mecure..
You offer little or no defense to the challenge of the deal being expensive other than a faith the Board will do the right thing.
Let's hope you are right and as Hickster and the most famous literary optimist Wilkins McCawber would say 'something will show up"
It's well hidden at the moment.
- 2022 revenue forecast decreased from UK£864.5m to UK£837.4m.
- EPS estimate also fell from UK£1.07 per share to UK£0.852 per share.
- Net income forecast to grow 56% next year vs 7.1% decline forecast for Oil and Gas industry in the United Kingdom.
- Consensus price target up from UK£3.76 to UK£4.08.
I'll gladly take £4.08!
Perhaps the 31.12.21 b/s cash, covered by the locked box, is approximately the same amount?
if Mitch does similar sorts of deals when he sells his own things. Like if he put his house on the market and someone comes to look at it and he ends up giving the house away and paying them money on top as well ?
Must be a wonderful chap to do business with if you're buying from him.
There has to be a big reveal soon. There's no way anyone sane would try and defend this deal, so it must just be a matter of time before something comes out that makes sense. This would have been expensive before any windfall taxes were put on production, but to pay that much per barrel in a 75% tax environment is utterly bonkers and bordering on negligent IMHO.
BB,
Thanks, what will be will be !!
Another little niggle which I have never seen before in any deal is the payment that has been agreed to be then subjected to an additional interest charges over prolonged period ....
SPA Page 16, Part 1 / 1.1 : A cash payment on Completion of approximately £58.7 million ....
WHICH IS THEN :
"Subject to adjustments including to apply interest to the cash consideration from the locked box date to Completion and to deduct any leakage....... estimated to be £61 million, once interest of 4 per cent per annum is applied to the headline cash consideration of £58,650,000 from the locked-box date to the expected date of Completion"
Which I estimate to be ~12 months of interest, so T&C's take advantage of the locked box for ~12 month term. This locked box is mightily opaque.... !!
aimo & dyor
Visitor / New KTOB
The Tailwind 31st December 2021 Accounts have the loan outstanding as $344.599
The loan we take on as part of the December 22 deal is £277m
Based on an exchange rate of 1.2 $/£ the two are broadly similer.
So nothing extra in the box with the exception of Dec 22 and Jan 23 cashflow which makes this deal any cheaper.
So nothing hidden here - its still expensive so why do the big PI's like it !!
Where is it?
Was posted on the 20th January last year, cash rich with the added production surely should lift the SP out of the doldrums, or is that too optimistic!
AA's got enough on his plate to get KIST moving again and I can't believe he would devote his time and resources to the North Sea now and certainly wouldn't come to the rescue here after his last rebuff.
Unfortunately for SQZ SHs Kistos has already stated they are only looking at opportunities outside of holland and the UK which is not what I would like to hear as an SQZ SH but as a Kistos SH I agree 100% with this decision one of the many companies using their brain and basic arithmetic.
Unfortunately a takeover is now no more than fantasy for the reason already given, as I stated before Mercuria have SQZ by the B**ls.
IMO KIstos will do well under AA and Mercuria will do very well with SQZ but the SH of SQZ will not be doing so well as reflected in current SP , I hope I am wrong and there is great hidden value in the deal that some have stated but none have seen.
Will sell on a high or when I want to use the capital losses, there should be plenty of opportunity to uses these losses with the reduction in CBT allowances coming in the near future.
No.
...............
Banburyboy - after receiving clarification, my initial suspicion regarding carve-outs and caveats from "leakages" and your post that TAIL 2021 div paid on 12 Jan 2022 is probably out of scope is indeed correct. So the whole lockbox date and leakages can broadly be disregarded, wont change the valuation and calcs we've all done here, why we came to our individuals decisions etc.
Visitor - good post. I have completely overlooked the point that the reference date for the debt was Nov 22 and as you say that should reflect cash generated in the previous 11 months.
The fact that the lock part starts from an earlier reference point than the agreed net debt is somewhat bizarre.
The dividend paid out in 2022 was in relation to the Tailwind 2021 year so is probably out of scope.
Logically you would expect closing debt to have fallen materially from Jan 22 to the Nov agreed figure to reflect 11 month cash generation.
But who knows with this deal .
At least that’s a big £2 million sell out of the way.
I was day-dreaming of us having a VAST time, +300% in two days off 12 month low !!! Then Kylie rode in, full Lady Godiva style, "I Should Be So Lucky"..... !
Come on Mr Market, you know Mercuria's plan now so lets have at least a glimmer of our re-rate.
aimo & dyor