Member Info for Breq

My guess is 16p. It was 13p before RRE's offer but IOG have claimed interest from others so somewhere between 13p and the current 18p.

Hoping RRE will deliver more than that through an offer.

Just a guess and we should always remember IOG's assets seem promising albeit in a volatile UK gas price environment.

Another important point is if RRE are not being given access to these loan documents then I don't think IOG or the LOG administrator can give them to any other potential offeror, can they ?
If they did then RRE could probably sue but also IOG shareholders or even LCF bond holders could sue on the basis that they are being forced to accept a non-competitive and so potentially lower offer ?

Yes it's pretty grimy.
Lots of red flags for me:

Why the unwillingness by IOG to give potential offerors ( like RockRose) access to loan agreements ? By being denied access any offeror is bound to limit their offer in case there's some adverse clauses in the agreements.
If the IOG assets were so attractive - and they do seem quite reasonable - why did IOG choose their sole pre-field development lender as a party to hand over two thirds of the company to ( assuming all warrants and convertibles applied). Was this absolutely the best possible deal they could have sourced ?
Why did LCF let LOG take all the potential equity upside on IOG type deals. It could have lent direct. Not through a middle man who takes all the potential cream.
Why has S&W been appointed administrator of both LCF and LOG. As LOG is a borrower from LCF then S&W could find themselves conflicted maybe ? What's good for LCF's lenders (the bond holders) - quick repayment of their investments - may not be good for LOG. So is there a problem here ?

Yes RRE and AA have been pretty brave expressing an interest in IOG in the circumstances. Let's hope the LOG administrator is providing the correct amount of information to enable them to go forward.

rxdav I appreciate the IOG/LOG/LCF chain is quite complicated but you are self evidently wrong to suggest that rejecting an offer from a cash rich company like RockRose, or any other in its fortunate circumstances, is in any way beneficial to LCF bond holders.
Here below is an explanation of why you are wholly misguided.
LCF bond holders have, as reported in the media, placed their life savings into these bonds. They invested in the belief that they would enjoy high rates of interest and easy access to capital. Sadly the administration of LCF means they now enjoy neither. Being dependent on their funds means they have a very high time value to their money. In your parlance a bird in the hand is worth three in the bush.
LOG possess warrants and convertibles. To activate the warrants they have to pay IOG hard cash. LOG are in administration. They have no cash. These warrants and convertibles have expiry dates beginning later this year. LOG simply does not have the luxury of waiting several years for IOGs gas fields to come good.
UK gas prices are volatile. Witness the 25% fall this year alone. This is one reason why IOG has as up to today been unable to announce a firm funding deal and why it has to date had to offer away two thirds of the company to its funder LOG simply to fund pre field development expenditure.
IOG do not have an operating team in place of the size neaded to run their gas fields development. They are currently reliant on a third party offeror having the manpower in place. There are few companies with field profiles RockRose have who are operators ( I’m assuming its Marathon deal completes) and so have the team becoming available in a timely fashion.

I’m all for wider share ownership. I’m guessing you’re of the ‘Sid’ generation, rightly lured by the opportunities equity ownership offers. You’ve already been a victim of ‘bad’ lending and I hope your situation is resolved as well as it can be but as previously mentioned IOG finds itself in a complicated and difficult situation. With all due respect the last thing IOG needs is some ‘Sid’ shooting off in all directions.

No, that's the point - IOG would have no idea there is any possible wrongdoing further down the lending chain. My point is - could they be a victim if a lender to them had known the funds lent were dishonestly obtained from the public ?
If one party to a loan contract knows it's based on fraudulent funds does that negate the contract ? I think there may be a principle of law that you can't use contract law to enforce anything that is illegal. I appreciate that's a legal question so probably outside your knowledge base ( even as a victim of bad lending) and only comes up because the chairman of LOG has been arrested.

For the record, the S&W report was on the assets of IOG i.e. is it a good project and hence good security for the loan.

Thanks rxdav for the feedback. Hope you didn't mind me asking you in your capacity as a previous victim of bad lending.

From what you're saying it doesn't matter what the original source of funds on lent to IOG has been ( even if later found in court to be fraudulently obtained by LCF). IOG are under no obligation to repay except under the terms of the contract they signed with LOG. LOG completely separates IOG from anything that may or may not have happened at LCF.

Just out of interest - the chairman of LOG has been arrested. I have no idea where that will lead but just say hypothetically a lender to IOG ( I emphasise IOG doesn't know of any possible wrongdoing) did know it was on lending fraudulently obtained funds. Would that make a difference or would you argue the loan contract between IOG and LOG means it doesn't matter?

Irrespective of any long position one might have in IOG, the latest Evening Standard article makes grim reading - apparently new LCF bond buyers were encouraged to buy bonds for a full three months after LCF had no chance of honouring their commitment to these bond holders. It sounds anyone who bought the bonds after Sep last year could have a case. I guess for fraud maybe if the ES article is accurate ?
Anyone know if this could unwittingly effect IOG ? Did they borrow from LOG after Sep last year ? Did LOG borrow from LCF after Sep last year ? Hypothetically how does it work if a company's source of borrowing originates from fraud ? Obviously in IOG's case even if they did enjoy funds after Sep they would not have accepted them if they even knew of any possibility of dodgy dealing further down the lender line. So IOG must be unaware of any dodgy dealings by LCF or even LOG. Is that why the LOG chairman was arrested ? But how does it leave IOG ? Anyone know banking law etc ?
Completely moving away from the IOG/LOG/LCF situation and just talking generally - in extreme if a person unknowingly borrowed from someone who stole from someone else and the theft was uncovered would that person have to repay the thief so the victim could be hopefully repaid as soon as possible.
I'll have a look at the RNSs and see if I can work out borrowing from LOG timings. Totally crummy for such a promising project to have unwittingly been involved in these lenders.

rxdav - I see from your posts you've been on the wrong end of some bad lending - from your experience of sub-standard activities can you shed any light ?

Smut, yes it's a real shame takeover bids have to be made almost blind when at companies like IOG - most shareholders are private investors - and so don't get contacted directly by the acquirer to see what price works for them.
Atb

rxdav, through my tears of laughter I respond:

The BoD are - under the Companies Act - obligated to do what's best for the company. Their own 24p options are in isolation not supposed to be a factor when evaluating the merits of a bid.
For you to suggest otherwise you're effectively stating the BoD will act in contravention of the Companies Act. Ordinarily I'd suggest you withdraw that claim without delay but in your case you probably don't have to as you could convincingly argue no one takes you seriously.

rxdav, I suppose if nothing else you're amusing. In fact you are extremely amusing. Thank you.

I'm with you Fast-ted. IOG's assets are good but they face 2 headwinds as I see it.

One is the price of UK gas which has fallen quite a lot this year. I don't think is just a hot weather thing. Global gas prices are depressed as LNG supplies are looking for customers even in Asia. Would an IOG bidder temper their bid due to this ? I don't know but it would be reasonable if they thought lower gas prices are here to stay.

The other is time. RockRose have the cash and can move quickly. Most - even large companies - are indebted and take much more time with their due diligence not just as a function of their size but also their wish to be seen as cautious by their bankers. My worry is the crummy background to LOG's administration - LCF defaulting on bond holders - means a quickish decision by the administrators is probably required in reality.

For what little it's worth if it were me I'd agree:

RRE pay existing IOG shareholders 23p
RRE buy the debt for £40m
RRE offer cash for the debt related in the money warrants/convertibles value i.e. 23p minus strike price
RRE arrange for any disgruntled IOG shareholder to reinvest in RRE shares if they can agree with a RRE seller like Macquarie so as to capture some of the IOG upside and RRE ( +Marathon) upside.
LOG gets a 2% gross royalty on the IOG fields. This money goes to LOG so will ultimately go to LCF bond holders as LOG has additional crummy non-IOG loans on its books.

jimmy00 thanks for your comments but trust me I've seen at close hand the real pros working on people.

rxdav is a tiny mouse compared to the experts. He's just scared his modest investment in IOG may turn bad.

Me I think IOG's assets are pretty good. The IOG board just have to be both clever and considered in their response to RRE's entirely legitimate and legitimately expressed interest. I'm not at all convinced they haven't snatched defeat from the jaws of victory with yesterday's RNS.

600T

Yes S&W will receive their fees.
Surge has already received its commission. Although there may be grounds for recovering this if it is found that Surge were knowingly selling a duff investment ( I have no view on the likelihood of this being the case).
S&W will try and expedite a return of capital to the bondholders.
The LCF bond holders do not appear to be covered by the FSCS.
Yes I do believe the bond holders will receive much the majority of the £40m. HMRC may have a claim on for example unpaid NI on LCF employee salaries but the majority of the £40m would go to the bondholders as soon as preferred creditors like HMRC are quantified and in the absence of an extremely high S&W fee.

I'd leave the court to decide what remedy RRE and AA may have if I were you.

Smut,

RRE's offer for the debt was formal. Naturally they required the loan documentation to progress to a firm offer. They lodged £40m as proof of funds. Difficult to see how they could have expressed more commitment in the absence of the documentation.

Careful Longside - if RRE and AA consider there are grounds for pursuing defamation claims they may use your posts as supporting evidence.

Quite the most negative RNS I could think of. In yesterday evening's RNS the Chairman thrice described RockRose as exploiting and trying to take advantage of LCF bond holders, whom as we know are largely pensioners relying on their 8% bond income.
Such repeated adverse public comment is highly unusual in an RNS which by its nature is designed to be widely circulated. Was the RNS approved by all members of the board ? In addition AA was singled out for adverse association by name.
Unfortunately LCF bond holders receive their investment back plus 8% interest annually. They do not directly participate in the future upside which may or may not exist in IOG's equity value except in the very oblique sense that their borrowing counter party LOG may or may not retain any IOG possible profits. LOG, which has lent money to IOG on rather juicy terms, will enjoy possible future upside in IOG's value not LCF's bond holders. Presumably that is why LOG was created. To enjoy any equity upside. Otherwise LCF could have lent directly.
RockRose is, as disclosed as of today, the only company which has made a firm, cash backed, offer which will result in LCF bond holders receiving the full proportion of their investment back which was on lent to LOG.
Any suggestion that RockRose is behaving improperly is not supported by the publicly available facts. Nor is it supported by the market which currently values IOG at 19p a share ( 13p before RockRose's rejected equity offer suggestion) and so perhaps rightly views future equity upside with scepticism.
One has to wonder why RockRose is receiving so much hostility to its committed and well resourced offer to effectively repay LCF bond holders their IOG/LOG on lent risked principal back and why RockRose has apparently not been given necessary access to loan documentation.
One hopes the Chairman of LOG will be in a position to provide some guidance and clarity on these matters ( assuming he is free to do so following his arrest).

rxdav

I stated facts not expressed sycophancy. AA has looked after RRE shareholders better than almost all other listed companies since floating 3 years ago.

It is your choice to avoid such a man but all I can say is I hope it's your capital you're investing not others.

Much as I want a good deal for IOG, I can't let you shoot down AA like you are.

Since floating RRE in 2016, AA has presided over a 5 plus fold increase in the share price. He has paid a special dividend equivalent to the IPO price. He has presided over 5 astute oil and gas field acquisitions. He has been a party to successful wells and field extensions. Over 200 Marathon employees should shortly be joining an expansion minded company with commensurate career prospects.

Heaven knows we shareholders need more CEOs like AA.

I can't understand why the LOG administrator wouldn't talk to RRE. IOG has the right to the gas fields so it's not like a competitor could take the fields off IOG.
My reading of AA is he puts shareholders first - look at his performance at RRE this last year - special dividend and share buy back.
Maybe I'm being overoptimistic but I'd say AA's natural instinct is to see IOG shareholders right to some extent.
Unless IOG have a firm offer from a well financed partner on the table then the LOG administrator is taking quite a risk. If IOG does have such an offer should it not be RNS'd already ?
Price of gas has fallen a lot this year. Companies who expressed an interest a month or two ago may be less keen as international LNG cargoes seem to be having a structural downward effect on UK gas prices.

2 things stand out:

The nearest study ( Bolero 2) to a placebo arm, if done in this STEM trial, showed a 0.4% response. So Evgen's 24% CBR response is nearly all better than 'placebo'.

The STEM patients who have gone onto the compassionate use stage are currently looking at around 9 months average progression free survival during that stage ( prior to final data being available).

( Think I heard the above right in Q&A at the end.)