George Frangeskides, Chairman at ALBA, explains why the Pilbara Lithium option ‘was too good to miss’. Watch the video here.
Rookie, because the sp would have spiked massively. IMO although I dislike ARCM it was an elegant solution to clear the short at a massive profit. Back in January they were out of the money big time. Covid & the Saudis helped them massively since then. Lucky or clever, probably a mixture of both.
Malafuster, your partially correct, they bought approx 80m shares, which they used to reduce their short. Hence their short is circa 6% now. They are out of the mix re the RI. Maybe they have other strategies in place re their short, but that’s their private business. Hopefully they will continue to reduce their short, but there again maybe now it is a valid hedge versus their bond holding?
Aduk, it’s a real shame that you’ve thrown in the towel. Will miss your contributions. All the best compadre
IMO ENQ is still taking on socially distanced passengers at the station, when fully masked & distance down to 1 metre or less then maybe the train will have left. Until recently buying ENQ in the teens was a good bet, I still believe that’s true, (like PMO sub 70p). Enjoy the ride IMO still plenty of time to get onboard.
When this deal was originally announced In January at a cost & Decomm liabilities running into hundreds of additional millions the share price hit 120p. Today we are sitting at 50p with a much much improved deal & Brent rising...The question is where will the price now settle, if we lived in a rational world north of 120p
That’s a big assumption bfc1, if Brent continues to strengthen & Pmo approaching 100k bopd & with financing sorted to 2023, it would imo be imprudent to increase the short again from this far out. ARCM only started to build the current short mid/late 2019 & they could have not seen the fallout from Covid, which has helped them enormously. On a different tact, as I’ve already posted, although it sticks in the craw, I think ARCM has saved PMO potentially hundreds of millions usd, by forcing TD to renegotiate the Bp deal & maybe ARCM may now see the company in a different light. Silver lining to every cloud.
I don’t like the ethos of ARCM, but in fairness to them they have forced to TD to focus on debt repayment & would we have got the Bp deal on current terms if they weren’t onboard. I hate to say It but The combination of Covid & Arcm has created an opportunity that TD has exploited.
Goldenbadger, Jan 2019 date enables Pmo to book the cash flow on their books utilising their tax losses, but will booked as part payment to Bp for the assets. Other than the 210m usd, rest of payments will flow from cash flow again utilising Pmo tax losses. To me looks like a blinding deal, other than having to pay of ARCM, but at least this deal gets them off TD’s back. Win Win. Having ARCM & Covid has helped TD strike a great deal at the very bottom of the current cycle.
Romaron, thanks for calling me an expert, I’m far from that otherwise I’d be smoking a fat cigar in the Caribbean. I don’t invest in Bonds, so no expert unfortunately, nor do I know the management of PMO, but their again I was reading an article by Terry Smith aka fundsmith & reading between the lines it would seem fund managers don’t have the access that we sometimes believe. Personally, I think within 2 years most Oilies will be in a far better space than where we are currently & if I had bigger balls & more funds I would be taking advantage. Cheers & have good weekend.