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Slift the covenants are not publicly available...and an obsessive type on the lemon fool or whatever it is called found some text suggesting HUR do not formally need CB approval before spending cash.
At 65 to 70 brent, which I fully expect, HUR's cash pile will swell quickly. Sure, WC steadily rising and production declining but they are cashflow positive...10000 x 40 usd was BE so 400ks USD a day costs. Now they are at say 12k a day x 62 usd or 740000 a day. Even a decline to 10ks would generate 620ks a day more of Brent reaches 70.
Ain't over til fat lady sings
At the point where HUR ceases to produce due to it being uneconomical or other reason, HUR's assets will be valued at approx. $160m at BEST.
With bond at $230m and cash in hand at $xm at point of cease of operations (following all outstanding liabilities).
Shareholders will be left with $ym = $160m + $xm - $230m
Ofcourse the $160m is at BEST value, so probably have to factor in a discount for that too!
"Bondholders dont know for sure we wont have spent it by 2022! They have no right to the money in 2021, none at all, just the 7.5% return."
Actually, there are convenants from preventing HUR just spending the cash.
If HUR do, Bondholders have the right to default the company.
Hence why HUR need the support of bondholders for FWP, as initially the support from bondholders with their money was for the development of the Lancaster Early Production System (which has been completed with well 6 and well 7z).
When debt exceeds assets + liquidity, the bondholders own this company.
Smell a rat here guys. Buying more in the morning. Made a packet on tullow and card factory. Risky, but with oil hitting $80+ in summer, I see opportunity here.
Frighten shareholders and then say look what we've been offered, let's bite their hand off because we were telling you the company is failing. Shareholders will say, oh it's better then losing it all...
Takeover soon and then jobs done by the BOD, it's so plain to see that they are planning on a 10p share takeover...wait and see...
Just focus on one thing at the moment, profit and free cash.
Who holds the cards now!! HUR I think...
They get nothing, zero, nowt!
What happens in July 2022 If we have no cash and no oil!!
Bondholders dont know for sure we wont have spent it by 2022! They have no right to the money in 2021, none at all, just the 7.5% return.
Cash is king , money talks!!
Did Debenhams have lots if free cash!!
Dont worry about the wording in the RNS, it means nothing. Worry about one thing, how much actual free cash does the company have, only a little, approx 120 million!!!
Michael - I too lost 25k when Debenhams got took over by the banks n bondholders. I still remember Debenham using that word stakeholders... but I'm sure we'll be ok . I still have a few shares in hurricane and will buy more if it dips.