Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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He does not understand bonds by the looks of it so there is no point in arguing with him.If anyone wanted to take a position he/she should have waited until refinancing.
Gulf keystone did a similar raise D4E in 2016, it worked out for them and I’m confident it will work out fine here, please check below history:-
13 October 2016
Gulf Keystone Petroleum Ltd. (LSE: GKP)
("Gulf Keystone", "GKP", or "the Company")
US$250,000,000 13.0 per cent. Guaranteed Notes due 2017 (ISINs: Regulation S XS1056559245, Rule 144A XS1056559088) (the "Guaranteed Notes")
and
US$325,000,000 6.25 per cent. Convertible Bonds due 2017 (ISIN: XS0841237497, Common Code: 084123749) (the "Convertible Bonds")
Completion of Balance Sheet Restructuring
Gulf Keystone is pleased to announce that the Scheme of Arrangement (the "Scheme") in connection with the Balance Sheet Restructuring Transaction (the "Restructuring") announced on 14 July 2016 became effective today. The expected settlement date for the Scheme is 14 October 2016
Restructuring
The Restructuring involves the implementation of a new capital structure to materially strengthen the Company's balance sheet with a significant debt reduction from over US$600 million to US$100 million through the conversion of over US$500 million of existing debt into equity of the Company by way of the Scheme.
IG
You truly are completely clueless. Only six weeks ago you were claiming that PFC a raging buy, now you are idiotically claiming that the senior debt is worthless.
Are you incapable of understanding that the debt holders will simply take control of the existing business. They are the only debt. They will pump in $300m of cash so combined with D4E (and dramatically reduced finance costs) it could be a great business.
Just look at the numbers as they do not lie !
17 Revenue $6.4B, Gross margin $785M, EBIT : S104M
18 Revenue $5.8B, Gross margin $718M, EBIT : $159M
19 Revenue $5.5B, Gross margin $353M, EBIT : $220M
20 Revenue $5.5B, Gross margin $279M, EBIT : -$142M
21 Revenue $3B, Gross margin $130M , EBIT : - $196M
22 Revenue $2.7B, Gross margin $-76M, EBIT : - $217M
https://www.macrotrends.net/stocks/charts/POFCY/petrofac/financial-statements.
Before SFO case and Covid (which caused contract cancellations and business interruption. These , in turn, resulted in revenue collapse and additional costs) , PFC did reasonable well and even Halliburton was prepared to pay £25/ share for it in 2012
The lenders must have seen and examined latest PFC business plan, provisional Q1/24 trading status and cashflow forecast till Q4/26, and comfortable with the progress of non core asset sale, BEFORE offering to provide $300million (£239million) in fresh credit and to keep PFC going and allowing PFC to miss bond coupon payment, otherwise they would pull the plug by now.
If PFC BOD can convince the lenders with strong proof that the newly won and future contracts have good margins (i.e. 10%+) as before 2019, I strongly believe D4E dilution ratio will not be so bad as the people have predicted (as the major shareholders will fight hard not to let the bondholders or any predator have the company on the cheap) and PFC should be mostly debt free by Q4/26, based on the forecast total revenue (till Q4/26) of $12B and a profit margin of 10%).
Shahz. I'm in agreement, a high PI contingent will defo be a red flag for me moving forward! PFC was a basket case a few years ago with the SFO investigation, it is here that PIs took the majority holding (especially with O&G out of favour for instititutes). Somehow the company has turned it around with the Tennet contract. If the MEED report on Algeria £1bill contract true then the company really is on a forward track. The investment industry now wants to take PFC from the PI and that is what this whole play is. It's going to need a left field solution. COME ON ASFARI!!!!
Do you not like pasta?
Ivor, don't disrespect my Comrade Baron. This is your last warning.
I see no possibility of a takeover until there is a clear picture. One will only buy this if they have clear idea of what they are buying. PFC is not transparent about results so far. They clearly knew results were not coming but instead of being transparent they kept it hiding until 29th. My view is simple they are doing it to stop a potential bid. If there was a bid, majority until a few weeks ago were PIs. Not sure how much ownership has shifted recently.
They are closing all options.
At the end it could be
1. full control by some
2.parts given to some
Bondholders/debtholders/shareholders (clearly All are losers as of now )
One lesson. Be careful on companies where PIs are in majority
Asfari is still our main weapon in finding a way out. That and ME connections.
His shares have lost on £100million in the last two years at current market price. I repeat £100million.
Thus there is huge incentive to find a way to salvage share price from inside the BOD.
I still look at tullow who managed to secure $2b in debt in a huge restructuring.
A third of that from a ME guardian angel would see PFC moving forward.
The SP decline has been (justifiably?) amplified by the shorts, the BOD need to step up now and the pressure for the performance guarantees will help them focus hopefully and put us in a better place moving forward. That said our chair Medori has been on the board since 2012 and look what has happened during his tenure. He needs to fall on his sword as soon as things are crystallised.
Kept my money in.
Ivor
There is always nonsense posted on chat boards, but there is Lao some genuine thoughts, feelings and information shared.
As for who is in control of Pfc. The BOD have taken as global service provider to the brink of bankruptcy, they have stated they are unable to pay the interest due on the bonds in May. They have however secured money for some performance guarantees which is very interesting. At what cost though, how much equity? Will they dilute to raise the interest payment, delay the interest payment, be forced into administration etc,etc.
Whilst the later is in nobody’s interest apart from shorts, it is a possibility.
We should find out tonight how many shorts bailed and that may shed light on their expectations.
This has been too much of a gamble recently, to often in these situations, the worst scenario materializes.
Good luck to the brave who held.
Bonds have already lost 85% value, so at the mintue market believes that bondholders wont get their money back.However if fresh money is injected and buisness improve than probability of them getting their money back increases.However bonds tell that equity is worthless.
Some are ramping the bonds. Even suggesting that the additional credit will be secured with some sort of super seniority. Absolute nonsense. There is no security worth a carrot as it has all been pledged already. The bonds will not increase by three or four times. Far more likely they will lose 90-100%. The only real hope for the junk bond holders is time or a takeover. Two or three years of profitable trading and maybe you recover 20 or 30%.
DO NOT BUY BONDS THEY ARE JUNK!!!
#positive restructuring" such a thing does not exist I am afraid.It is clear from last update that shareholders would lose a big percentage of their investment.We will find out soon how big it is.
I, like many, am sad to see the demise of PFC. Good luck to all and their future endevours. We will cross paths one day, on another chat. Get ya'self over to TLW.
I would have thought some of shorts cashed in yesterday. The price action suggests some did.
Superdry , Cineworld, McColls, COPL , Bahamas petroleum …. It’s a disease on many share discussion groups
What is for sure is that we have some people on here that will vanish into thin air if any positive restructuring is announced. Many are spouting negativity just because it makes them feel better for selling out or never actually investing in PFC. Interesting month ahead. GLA LTH
BloodyRedFackwit
DYOR incel
Petropasta
petro****ed
Everyone is wrong, why? They know nothing.
Shares will be worthless? No, they are 10 not 3 or 4.
Bond holders are safe? Not likely. Lost 80 -90%.
Creditors are in control? No. The BOD is.
There will never be a takeover? Now THAT is the question.
DYOR. Most of the posts are complete horse. The ones who post the most talk the most horse****!
So your not invested at all?
No wonder you are called Bro-Ken Broker investing in garbage like this
I’ve just posted this on ADVFN in reply to a bondholder friend who said
‘One third chance bondholders refuse to inject more cash and it's a zero.
One third chance, I double my money.
One third chance, I treble my money’
I said my take was
Low risk of wipe out because debt holders are in control. That’s $860m of debt that can be subjected to hair cuts/PIKs/extensions as required to obtain the $200m Performance Guarantees. I’m assuming that all parties believe that the $300m proposal is ballpark what’s required. Principle risk whether the BH’s and RCF/TL’s can work together?
The new $200m bond will be super senior and potentially highly attractive. Could be sugar coated with early redemption and high interest rate.
The $100m equity raise is unattractive since shares will immediately trade at large discount to the 4 - 5p D4E price. However could come with warrants.
Debt holders will have to really screw up if they can’t salvage something?
Most likely outcome?
Latest RNS says a significant portion of debt will be converted to equity. Implies BH’s keep maybe 25% to 40% of their bonds if lucky. No mention of haircuts but the bond price indicates that this is in the post.
Could double your money from 21 cents and, with patience, might easily quadruple once the massive overhang eventually cleared.
And post restructuring would be ‘now or never time’ for any potential bidders to snaffle up PFC up on the cheap.
What’s the right Enterprise Value for new financially solid PFC?
It’s been trading around $1bn despite the threat of restructuring, probably thanks to excessive PI enthusiasm. Going forward it will be cynical debt holders controlling the price and the sexy geared upside that’s so attractive to PI’s will have been heavily diluted.
Brokers seem relaxed with a > $1bn EV though.
In summary there will be $200m of new bond debt plus $100m of new equity but offset by $300m new cash so EV neutral. Hence lots of latitude for debt holders ($860m) to take haircuts to get this over the line.
I guess the answer is no. so all this bull about short squeeze iis nonsense. like most things said on this board yesterday. so just have to wait and see what happens next.