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"devonplay,
Or if it all falls appart you could be offered 45pc or less for your bonds."
That's possbile, but by who? If it all falls apart then it won't be the company will it! and if there's a change of control they might have to buy them at par, but if's that's the case then it will be likely after the company has defaulted and the equity has 0 value. I'm sure it's more thanpossible that the debt migh take a hair cut, but lets be honest, at the moment the future of the company is dependant on 2 votes and the second can't take place until the creditors have agreed. The debt is already trading at a discount, so what would you prefer 45% loss or 100% loss of your equity if the deal falls over, that's why I'm of the opinion the management will want to get the placing away at what ever price and that becuase of that the offer will have to be at a steep discount.
devonplay,
Or if it all falls appart you could be offered 45pc or less for your bonds.
"You have some fair points Devon"
I try to be fair. I'd like to see them get the deal away that's on offer now. I just expect the management to feel that same, BUT I don't think they've got many options. I suspect the RCF and bonds have "change of control" clauses in them that will put off acquires, hence they might have to price the placing, and given the timetable I think it's likely to be a non-premption placing, at a heavy discount. Hey, I'd love a bidder to step frward and have to buy me out at par..I'm just not expecting it anytime soon.
Devon, these covenants were from 30th June, deferred to 30th September. If they wanted PMO to breach why didn't they just do it back then? There is also potential to defer again but would look really bad.
You have some fair points Devon but let's just wait, speculation is fruitless, nothing is in our hands.
Go enjoy the last of the sun people and have a good weekend all.
then a very low raise may help their short position, why still retaining their long high yielding debt position.
"OK so all that is needed is 75% support and do you not agree that the vote is about the price for issue of the equity? Once the price is agreed then we will have that 75% support and PMO back in business right?"
"do you not agree that the vote is about the price for issue of the equity" No it isn't. If it was about just the pricing of the equity why would bond holders care? They wouldn't care if it was raised at a 1p, dillution means nothing to bond holders, only equity holders. It may be about the amount being raised, but what it's raised at matters not a thing to them. Unless they are also holder's, if they are holding both assets, and short the debt, them a very profit mught actually benefit them, if they also get turn on the junk debt.
I'm definitely a loser and, yes, I am sore. But most oil investors are losers so I am far from alone.
If BP is 245p and RDSB is sub £10, I can't see what the attraction of a debt-laden zombie like PMO is.
Anyway we'll see how this plays out and who was right soon enough.
Happy
"Each to their own, but I for one have filtered Devonplay. Just a twat holding a few bonds that thinks he's Warren Buffett. Hasn't the risk profile for equities, so wtf are you doing here? Just a lonely ****** who likes seeing his muses in print."
Hahahahah
OK so all that is needed is 75% support and do you not agree that the vote is about the price for issue of the equity? Once the price is agreed then we will have that 75% support and PMO back in business right?
"But now they have tentatively secured the £325m this would mean creditors would provide the other £200m odd of the £500m odd (sorry don't recall exact amounts). You'd hope this sort of support would give reasurance to the remaining creditors require to get to the 75%."
See I still think that's specualtion, you have to accept that pushing the company into breaching it's covenents might be more valuable for a set of creditors than accepting the deal, hence why the companty hasn't reached a deal yet with 75% of them. They get to rescructure in a way that might allow them to take equity and keep debt in a private company. That's usually at the cost of pi investors.
"Before you post, do some research please!"
It's not part of book building process, until they've reached a creditor vote there's not book buidling process., so it's not commited money.
Do you understand corporate financing?
Devon, you are right and it is a worry, I have a substantial amount at play due to my own failures. But now they have tentatively secured the £325m this would mean creditors would provide the other £200m odd of the £500m odd (sorry don't recall exact amounts). You'd hope this sort of support would give reasurance to the remaining creditors require to get to the 75%.
I guess no point entertaining conversation, best to wait and see.
"Devon, can you explain why Schroder's upped their stake above 5% after reducing earlier?"
Easily. They may have a longer position in the debt. If the deal gets away the debt and equity should rise in value, if it doesn't then they are likely be getting more equity from the debt being converted into a shareholding at the expense of the exiting shareholders. They can play a more complex game based on being able to operate each side of the cap. table.
HappyInvestor100 wanted to influence small investors to take position on Friday afternoon, and possibly loose monies. Sore looser.
"You miss the point, if they don't do a deal in 12 days time there aren't going to much the shareholders can do if the creditors vote to call in the debt."
Have you not seen the article yesterday where it is mentioned by a reliable source that they have secured the funding in excess of the targeted $325M. Before you post, do some research please!
I'm guessing you know what happens when a company can't pay it's creditors?
I have an interest in the company, in it's debt. It's equity should now be doing what it's job is, refunding the compant. Ay what price matters little. As long as it's able to refinance to the extent that it can settles with it's creditors calls.
Devon, can you explain why Schroder's upped their stake above 5% after reducing earlier?
If 15p or 12p is the dilution price why the market is pricing PMO today at 19p still?
Another thing that you don't get is that once the uncertainty is removed, you will see a coiled spring bounce as market knows PMO is going to produce 100KBPD next year and there will be no debt maturities/convenants tests until next 3 yrs or is it 5yrs? 30p in no time depending on covid situation.
Hopefully if in the weekend bloody BJ doesn't announce any serious lockdown measures then next week should be a good one for PMO.
"Yes that price they pick with will impact existing holders so to keep them happy they will pick a price close to current "
You miss the point, if they don't do a deal in 12 days time there aren't going to much the shareholders can do if the creditors vote to call in the debt. ""Group's creditors would have the right to vote to declare the Group's debt liabilities immediately repayable. "" You'd have to find a couple of billion, not a couple of million.
If my life ever got that empty I spent my days on BB’s I have no interest in to rub Investors faces in their losing positions, I think it’s time I would call it a day.
Sad really.
Good point Kenni, ignore these useless posts... what's the point in picking prices out of thin air??? I go back to the interview with Malcy on 8th, TD quoted as saying market has priced shares around equity raise price.
FFS it could be 1p a share for all I care but the whole point is the amount you invest which is what PMO care about. Yes that price they pick with will impact existing holders so to keep them happy they will pick a price close to current SP.
"In addition, since 8 July 2020 the Group's leverage and interest cover financial covenants for the testing period ended on 30 June 2020 have been deferred under the terms of the Stable Platform Agreement. Without the deferrals contained in the Stable Platform Agreement, the Group would have breached the financial covenants contained in its financing agreements in respect of the testing period ended on 30 June 2020. In the event that the Proposed Refinancing is not agreed or finalised by 30 September 2020, if the Group is unable to obtain a further deferral or waiver of the financial covenant testing for the period ended on 30 June 2020, there is a risk that an event of default may arise prior to May 2021. If such an event were to occur, the requisite majority of the Group's creditors would have the right to vote to declare the Group's debt liabilities immediately repayable. "
"In the event that the Proposed Refinancing is not agreed or finalised by 30 September 2020" "Group's creditors would have the right to vote to declare the Group's debt liabilities immediately repayable. "
Don't they know it's not an AIM company? In 12 days time....and so far less have agreed to to the proposed refinance. Who's hold the cards again? I'm guessing theirs a large correlation between the equity and debt holders, their exposure is likely to be greater to debt than equity, so equity is noise. You'd need to price at a discount to get it away, hence the highly discounted placing. Pi's are going to be diluted out of existence.
Guys do not replay to the post with 10p placing...
Start new one. Replaying to it you are helping derampers who came out of theirs caves today
Nope 19p just paid
18.0p coming.
You are deramper of the week. Congratulations.