Member Info for ivorgriffiths

the bod do not have to report anything at the moment or would have done. everyone is guessing. it could drag on for months and months and fizzle out to nothing. creditors will bend over backwards to get paid and do not want shares in a ****show instead. they are saying nothing either which is notable. if they thought they would get paid winding up petrofac they would be doing it. insolvency or takeover or wait to get paid. no news is good news for lth. read the accounts, read the going concern statement carefully, dyor.

The PG was due on 16th June.

If that payment had been missed they would have to report that. The idea tbat the last RNS is accurate until contradicted by a subsequent RNS is wrongheaded. Any agreement for a D4E would require an RNS. Losing a contract by defaulting on. a PG would require an RNS. All of a sudden being paid all of the receivables would not. Legally there is bery little they gave to tell us. It is possible it could trundle along like this for months. Possibly until the next accounts unless they get a major deal in but not necessarily.

The fact we have to hand is that there has been no RNS. There is no D4E but other than that we know nothing. And they don’t have to say a word either.

The disclosure requirements are such that there is very little a BOD is required to legally report. If they had not paid and given they said it could lead to insolvency ( which they so have to report ) it has either been paid or arrangements made. They seem to be trading through it and collecting on money owed and asset dosposals.

Looks like short positions reducing quietly. A short squeeze being avoided so far as Petrofac are reporting the bare minimum and getting the billion of receivables in and paying creditors. The market will pick up on the fact that the corner is being turned and a nice sustainable upswing in the value of bonds and equity will begin. We are scarping along st the bottom but the BOD do not want a takeover so won’t make a song and dance about it. But UK stocks and so bonds are hugely undervalued. Hargreaves Lansdowne is the latest takeover.

An approach is on the cards as the D4E is being swerved as cashflow improves from the highest volume n sales Petrofac have ever had, in 2023, begins to bear fruit.

Expect 250+ per share.

F you joined the chicken rn now is the time to get aboad the gravy chain. Not financial advice DYOR.

The short sellers only real worry is a takeover. But they will now know there have been no catastrophes so will suspect payments or arrangements have been made. If PFC can trade through then a slow reduction in short positions will follow. They have 50,000,000 shares to buy to close. Of this starts happening it means a D4E or insolvency is not going to happen.

The going concern statement was very negative overall. But as well as mentioning insolvency a fair bit they did seem adamant that the 2023 business that they have written is going to make a lot of money. They are also chasing a billion owed if you read the accounts.

My hope is for a takeover bit next best is that we do not hear a word for months as they are getting cash on and trading through it, other than news about more contracts no news is good news. If the creditors are convinced they can get paid with money rather than shares then even if they have to wait they will wait, not long - but they will wait. As time goes by the shares will creep up in such a scenario. As long as the BOD are on top of it all they won’t say Jack.

Sadly, Hargreaves Lansdowne have run a pretty negative story, in so far as it is realistic, but does not rule out a takeover of some sort.

There is only likely to be a short squeeze if the BOD can swerve a D4E. That would probably kick the shares back up significantly but let’s face it, barring the unexpected a short squeeze is fantasy.

Nothing has been suspended, no RNS and no change. Just misleading guessing.

The bonds are not suspended. This is incorrect. There is a suggestion that two unnamed, probably fictional, brokers are not dealing them, this is unverified disinformation. But they can be bought and sold so are not suspended.

No RNS so no catastrophe today. Looks like they pulled a rabbit out of a hat and got some money in. If the possibility of insolvency recedes the likelihood of D4E recedes also. The BOD are fighting for their lives. Good, about time.

If they could not make the payment they would have to report it. They were due to pay by midnight 160624. Looks like they paid it. One possibility, on a separate note, and as a kind of takeover would be if a third party bought the debt.

Given the monies owed to PFC are significantly higher than the entire debt it is entirely possible they can continue to trade through this liquidity issue, make the payments, and potentially either renegotiate the existing debt or replace it. Thereby the BOD survive, avoid a D4E and a hostile takeover. As you say the lenders want cash not shares and if it looks like they could get that in someway they will wait.

It is actually very positive that there has been no RNS . I was expecting bad news but no news is good news.

Clearviews

Totally agree. I think if they are managing to do what they said they were trying to do and can raise cash and simply keep trading we will not hear a word. Time is a healer now and no news is, in the short term, definitely good news.

GKP is not similar to PFC at all. Location, jurisdiction and enforceability of security all different. Also insolvency is much like pregnancy, you cannot be “effectively insolvent” you either are, in which case you must cease trading or you are not.

The bondholders and creditors are not in a position to proceed with either a D4E or insolvency. The reason there is no RNS is because monies have either been paid or renegotiated.

A takeover is the likely scenario. Receivables and debtors is such that a takeover is likely as it is a liquidity issue rather than an insolvency issue. If the security is unenforceable the bondholders will get shafted by a takeover and any D4E will be unfavourable as well, assuming they can get one at all. They need 75% of creditors on board and are well short of that. The going concern statement is now outdated and in any event needs to be read in conjunction with the full accounts and in the context of the BOD being toast, cli ging on by their fingernails etc.

Takeover is likely imho but DYOR.

PC

The end of year accounts and balance sheet tell a slightly different story to PFC simply being insolvent. In English law, a company is considered insolvent when it is unable to pay its debts as they fall due, or when its liabilities exceed its assets. Outstanding contract payments, liquidity and receivables exceed the debt. The backlog and goodwill have considerable value. In addition the security the lenders have and the legal entities that actually owe the money are disparate and not necessarily within the jurisdiction. There is one negotiated default and so PFC are not insolvent. They need to get paid so that they can pay. It’s a liquidity issue and not the same as GKN.

I would be surprised if we have an RNS anytime soon. There will be no D4E of only 41% of creditors are on board. They clearly do not fancy their chances enforcing the security and PFC can string them along for months until they get their paper assets liquid.

The business has far more value than the equity suggests which is why a takeover is likely. GKN is not a fair comparison as it was insolvent PFC is not.

If Petrofac were actually insolvent to continue to trade would be wrongful trading. They have liquidity issues because the BOD has underperformed and the banks and markets are valuing the business accordingly. They are chasing money owed as the banks will not provide the liquidity they need. If we hear nothing it means nothing catastrophic has occurred and until we hear anything the shares will bobble around at 15 - 20. When we hear something they will either drop like a stone or rapidly rise. A D4E is more likely than anything else but major shareholders will be trying to come up with something else. If the CEO walked ot would trigger a solution but no sign of that. It could stumble on for a year or more.

They will be negotiating the swap. But unless 75% agree and they get a court order it won’t happen. No creditor will agree a swap unless they all do or the ones holding out can wind up the company and the ones who swap get wiped out. All or nothing, and the company have the credit spread across multiple legal entities so the security may not be easily realisable. Also, the creditors will not be keen on retaining a BOD that has led the business down the path it is on. It is basically insolvency, takeover or D4E or maybe all three.

If they make the payments we will not be told. Id they do not we won’t be told unless something happens as a result. If there are takeover talks, investment talks, creditors meetings they will not tell us. If they get a big contract or a winding up petition they will tell us. They don’t gave to tell us much at all.

The market seems to believe, given the recent announcements and accounts there might be a D4E that will mot be catastrophic for equity, there is less chance of a takeover than a D4E and that the shares are worth 15. If the recent contracts are good any analyst will see the value of the business is not reflected in the share price BUT the BOD are tools and will not co-operate with any approach. A billion would realise a debt free niche market energy sector infrastructure business with decades of trading and a track record of technical proficiency and reliability that is reflected in its back orders.

If the BOD disappeared in a puff of smoke the SP would hit 50 immediately.

Petrofac never report unless they absolutely have to . If there is no problem reportable they won’t say a word. The word I want is “takeover” preferably hostile.

PC

No RNS. Poker chips pointed out that if you read the accounts carefully - and he is right - Petrofac have a liquidity problem, they are chasing a considerable amount of receivables, over a billion, I would suggest that they may not be technically insolvent although the bits they used to secure the bonds might be. They have a web of legal entities to hide behind, Petrofac is the shell.

Given time is up on the default and there is no RNS what does that mean? The major shareholders and those holding the voting rights in the shorted stock have about 30% of the company and may have been buying a lot more.

I do not think the business will fold. But DYOR.

The best out is a takeover, breaking up the business is an option though. The BOD are a serious problem.

PC

They cannot usurp existing secured bondholders unless it is contractually possible to somehow unsecure their loans. Super seniority would need consent, and they mention the need for High Court approval so need 75% creditors to agree and the shareholders. Those with short positions do not have voting rights. The original owners will never agree so they need a fair chunk of PIs to avoid insolvency. But there may have been developments: prepayments, settlements, advances, alternative sources of credit or even takeover discussions. There is a strong possibility we hear nothing or just wooly and ambiguous negativity.

The BOD are the problem and they do not want to leave. Even if they have performance guarantees would you believe them? They ar f%{#ing useless!