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They refer to rights issues or share offerings that are available at a discount to existing shareholders.
“dont be ridiculous”
Look in the mirror mate. I guess if you want to be rude you’re good at that but it’s not our fault you’re skint so don’t take it out on everyone else.
It will be a mix of solutions. I agree that once it is done it will improve.
Sorry, I meant you have no idea what the NAV is. The share price is obviously being manipulated.
We have no idea what the NAV is or what the priority is The Fitch downgrade is premises on the idea D4E is a done deal.
Petrofac have to asset strip to pay off debt as well as shave the bondholders and the BOD have to be very careful in the glaringly obvious game they are playing, especially given the criminal back story - which is why they are where they are of course. A mix of solutions is likely and in the medium term will significantly increase the value of the business, but only if the business they are getting is more than chasing turnover. D4E is not enough on its own. But receivership means no one gets paid.
D4E is a red herring. They use it to manipulate the share price. Knowing a share will go up or down 10 or 25% is incredibly valuable. The careful wording and the hedge fund short position timely adjustments scream “insider trading” but nothing anyone can or will do to stop it. The value, provenance and nature of the “non core assets” is what intrigues me. The BOD have a duty to shareholders and in reality they will have to sell stuff before they can rip off the shareholders and bond holders. If your loss is less than £10k and a D4E happens without asset stripping you have a small claim and now risk of a costs order if you lose. If you believe you have a good case - for example the defence to a small claim is crap - it would even be worth risking kicking it up to the fast track so as to force them in disclosure as regards assets and efforts made to sell them. They need to watch themselves as they can be made personally liable, which they know. I think they are trying to shift the PI shares into another vehicle or parties’ hands that are institutional to avoid such risks prior to some form of merger, takeover or a major investment by a hedge fund. In the later case they will want a massive say and board room presence. D4E is risky before asset stripping and probably unlawful. PFCVeteran made a bad move imho. No D4E in my view but DYOR.
Of short positions are closing then they expect a spike. They therefore expect positive news. Of you can get away with market manipulation why not manipulate it? You buy a few shares to push it up a bit. Then crash it and buy a ton of them as the PIs and day traders bottle it. Then sit tight and wait for some totally unexpected good news: an asset sale as well as upfront payments and legacy payments have saved the day but to cap it all there is talk of a takeover or joint venture and a couple of billion in new contracts! I mean, if you can buy 1,000,000 shares for £200k one week and two weeks later flog them for £600,000 who wouldn’t? That RNS served a purpose and that purpose was to make someone a ton of cash.
Paul Curtis is holding junk bonds and his only hope is that there is a D4E to cover his exposure. A takeover would be even worse for bondholders. If they enforce the loans they get nothing because the security will be used to pay the receivers, lawyers and court fees. He is really a shorter and wants a D4E just like them. He is down 75% assuming he didn’t pay a premium for his junk bonds. Shorters closing out will push the share price up and is good not bad. He is ramping bonds in other words.
The BOD would rather survive a D4E than get sacked by a hostile takeover or even a semi friendly one.
13,000,000 traded 23 not bad really. I just cannot see that lenders have anymore faith in the board than me. They release a negative RNS when they did not have to and don’t release one today or when the Algerian contracts were awarded. It seems chaotic. I just hope there is a hostile takeover brewing. If the new owners avoid a dilution and get the business back on track we can at least look forward to slow upward progress and more competent management.
Mind if it hits anywhere above 30 again I am getting the f#%k out of Dodge if there is no progress.
The problem with the order book is that much of it was obtained corruptly by personnel who may have been on a commission. If it is £8 billion profit might be £400-800 million. That’s not enough. What is interesting ate these non core assets. How much are they worth?
The backlog is unlikely to be much more than turnover. The BOD would prefer a D4E to keep their jobs. But a takeover even after a dilution is likely. But it is possible they could stumble on into receivership. Long term a takeover would be preferable as there is a prospect of recovery and it will have a positive effect on the share price. The value of non core assets is the really interesting point and the fact they are or rather might not be securing any debt. What are these assets and how much are they worth?
We do know that the bonds are junk whatever happens.
Don’t buy any bonds in Petrofac and if you have any take the 28% and head for the hills.
They will never be able to settle £900,000,000 of debt with a D4E. The security must be trash for that even to be a realistic option - which it isn’t. The only way out is for the board to resign following either a hostile or friendly takeover. But the bonds are only junk as it stands.
The bonds are effectively and de jure secured on the company as the security offered (if you can call it that) is likely - but not necessarily - owned by the company. Defaulting the debt will result in a wind up and then the bonds are just junk. At the moment they are worth about 25% of what they are “worth” and whilst pari passu principles are bandied about by purveyors of bonds it is a very slippery and definitely variable and relative term. Of course if the “assets” of Petrofac consist mainly of the backlog then there aren’t any easily liquefiable assets at all. The moment there is a default he bonds become worthless and take their chances with the other creditors.
Of course the most important creditors are the Insolvency Practitioners, accountants, lawyers and the Court Service. Their astronomical fees and charges are paid first and in full. Given Petrofac obtained many contracts on the back of bribes the legacy contracts are definitely dubious.
Bond holders will be lucky to get 1-5% of the paper value. Even then they will have to pay their own lawyers to get it so net of those charges they will recoup between 0-1%. That’s why they are holding junk.
Their only hope is a takeover. Even then 25% is all they get. The “other investors” mentioned in the RNS is significant and hints at a takeover of some sort. That is the only real new information.
If a takeover is occurring and it is a hedge fund that is holding a large short position then Friday’s drop was engineered to allow them to close out by buying the predictably high number of shares that would be available AND keep the price down. The bonds are worth 25% of the debt secured on them now as well. Not quite junk bonds - yet. So they can cover the bonded debt, buy all the shares as well as fix the balance sheet for about £350,000,000 as of close of business Friday. But as soon as it is announced that may double. The threat of D4E concentrates the minds and makes 45 look pretty good. Let’s face it anyone buying in the last six months would take their hand off for 60 now. It’s the game.
The only reason a BOD would push its share price down is if a takeover was in the offing and they were being offered favourable terms if they can facilitate a sale at say, 35-50, rather than 75-100. It is illegal and dishonest but DYOR. The D4E would involve basically all the shares being owned by the lenders. They would also be taking on secured debt as well. The company is worth about £200,000,000 in theory but in a firesale? £25,000,000. A hedge fund that is also shorting may well be talking to the BOD about a takeover. With liquidity and new management the company could easily treble in value. But only at 45 a share. See?
If the bonds are secured then the company cannot sell the security as no one would buy it. Bonds are just junk in a wind up. But if the $600,000,000 is truly secured - per the last financial statement - the creditors effectively own those assets. Pari passu is irrelevant in that case they will call the loans in and sell the assets. The $260,000,000 payable in October is not said to be secured in the last financial statement. This is relevant because if it was the banks would not negotiate that debt at all. Why would they unless the security is itself junk now.
The bonds are effectively worthless if they are unsecured. The equity is worth £0.25 per share. That could change but many of us could cash out now and take profit now. But I suspect a takeover is the only way out now and one or more of the short positions are being used - along with unnecessary and negative RNS releases - to suppress the takeover price and pressure the board, who should resign.
Of course the banks and other lenders might want to own Petrofac but I am taking a punt on the idea that someone else wants to own it, fire the BOD and that they will pay 35 - 50 to buy Petrofac and get away with shafting the unsecured bond holders as well as everyone holding shares above 35 - 50.
They don’t want shares the banks want money or security. If they would take shares instead they would have done it by now. The company is valued at far less than the $250,000,000 they need by October. They have to find another $600,000,000 by 2024 but that is backed by security so might be extended.
The BOD think about the BOD. How can they sell bond holders and shareholders (other than themselves) down the river? How do they keep their own shares or at least an equivalent value of shares?
Manipulate the share price down, agree a takeover at a lowball price and get shares in the new company or keep their own. They might have to resign but should anyway. A hedge fund with short positions is the most likely to takeover and will be happy to shaft bond holders as well.
It’s the game dude. We might - might - get 30-50. But don’t hold your breath. 45 is my guess. They can bully us for months though. They are holding back the news on the Algerian contracts leaked on meed last week. Remember?
So, crap financials, RNS talk of D4E, holding back good news = BOD illegally pushing down their own share price to save their own sorry a.rzes. Sure, report them. Nothing will happen.
The BOD are doing a deal for a takeover or significant investment. Their shares will recover when we have been bullied into taking 30-50 for ours. This is why they have pushed down their own share price.
Unsecured bond holders are losing 70-90%.
The last financial statement mentions "senior secured notes," which are a type of debt security issued by a company. While they are similar to bonds in that they represent a form of borrowing, they may have slightly different characteristics and terms compared to traditional bonds. In this case, the Group's facilities include senior secured notes, which are a type of debt instrument. They are secured on assets. They are due in 2026.
This statement indicates that after conducting a capital raise and refinancing in 2021, the Group extended its banking facilities in a US$162 million revolving credit facility, and two bilateral loan facilities totaling US$90 million, all of which are set to mature in October 2024. This information outlines the Group's financial structure and obligations in terms of debt and credit facilities.
They need $250 million by October this is the issue. Bond holders are screwed already. They are taking a 70% haircut minimum as they have no votes.
Banks will wind up the company rather than take shares if they think they will get 100%.
The Board suppressed their own share price as they need shareholders to vote for a lowball takeover of 40-50. If that.
They have no chance of raising all that cash by October and the directors and other investors are getting oaid off to shaft unsecured bond holders and PIs.
That is the actual change. Not D4E.