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Andy- thanks for your post and I endorse your view. I too have topped up in the last couple of weeks when the SP was in the 16s. I didn’t find bottom but bought rather than lose the chance to top up at these prices should the Niger RNS arrive.
I will continue to top up as funds permit.
In addition to the anticipated profitability and FCF I believe is now being enjoyed, it’s also worth remembering the underlying asset values since the 7E completion.
The back to back deal with AIIM valued Accugas and Uquo alone at 20.84p and this was at a distressed asset valuation. Add in Stubb Creek and the uplift to a going concern value and the CPR Nigerian asset value net of debt equates to over 50p. Then add in the value of Niger assets.
The major shareholders list published last week also speaks volumes, its not surprising the IIs were happy to average down by taking the bondholders shares at 20p or less and the radio silence spooking PI’s with a short term view is giving II’s and PI’s with a longer term view a great opportunity.
It should also be noted that there were no changes to the Directors Shareholdings. I’ll bet they would love the opportunity to add at these levels but the ongoing Niger negotiations mean the close period continues.
This is why I’ve been buying over the last 2-3 weeks. Fear of a huge short position (Pi’s sell). Fear of Institutional selling (Pi’s sell) Fear of somebody knowing something (Pi’s sell). The reality is very different. Savannah the parent company is sitting on roughly £40M in cash, Savannah Nigeria is sitting on £11M cash whilst producing £8M a month in free cash flow. The company added a new customer 3 weeks ago and stated everything is on track to fully contract the CPF by the end of 2020. The team is actively trying to renegotiate the debt package which in turn tells me they are getting paid. In an interview on the 31st January the CEO said they expect to introduce a partner, start an early production facility and continue exploration drilling in Niger. The company is now in a strong position in terms of farm out negotiations but are unlikely to update the market until the outcome is known. Likewise if a JV wasn’t on the table I’d have expected a strategy update by now. SAVP investors have got themselves in a right tizzy the last few weeks. From my observations the seller is happy to churn on daily volumes but Pi’s selling is driving it down. Institutions have been happy to add to holdings at higher prices and they have far better access than many here. Seems to me like opportunity knocks and I’m happy to accumulate more until I see reason that the story has changed.