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Denbury has been exploring options and is working with an advisor on a potential sale, sources familiar with the matter have previously told Reuters. Other potential buyers could include oil majors such as Chevron Corp (CVX.N), the sources said.
The company specializes in using carbon dioxide to extract oil from old wells and thus is seen as an attractive asset for oil majors and other large-cap energy companies that are starting to make bigger bets on the environmental, social and corporate governance (ESG) strategy.
Denbury emerged from bankruptcy in 2020 and its stock has performed strongly since then, thus providing an exit opportunity for its creditors who became shareholders in the company.
My own view is JV talks terminated because an agreement couldn't be reached on value. Cowan was all 'gung ho' in stating that interested parties needed to align with his own view of value in order to partner. Senior lender, dismayed at the breakdown in talks and pi**ed off with the never ending stalling and diatribe from COPL decided enough was enough and wants to see progress now. Cowan forced to step down. No more waivers and no funding so only option is to sell off some assets.
Restructuring the business by selling off some assets may be a good move in my opinion. I have been involved in restructuring deals before where some assets have been sold off and companies can survive, thrive and prosper. In the first instance COPL need to demonstrate that they can be cash flow generative to meet the SL demands - Richardson, Cowan and Gaffney are not specialists in restructuring Province are - it may well be 'last chance saloon' but at least give them that chance