Member Info for ivorgriffiths

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.

Nothing new was said. Nothing has changed. The only real change here is that the trolls have come back to gloat about the fact nothing has changed. No one knows anything. Anyone who says different is just speculating and talking twaddle. Like I say, nothing has changed. Same old hogwash from the same old hogs. Hopefully they will go away soon.

Apollo were after the Wood Group so they see value in the sector for the long term. Petrofac is undervalued but only if the management depart. They have failed to sort things out and ate vulnerable to a takeover. 50 - 60 looks pretty attractive at the moment. So if they can persuade the BOD it would be to their advantage it could happen. The lenders don’t want promised land offers and a full order book they want liquidity. But the BOD have failed to secure it and look pretty insecure from where I am sitting. I mean would you want the same management team? They are a billion in the hole!

The BOD did not have to issue that RNS as the only thing happening was a slight increase in the SP. They knew that that RNS would wipe out the rise even though it said nothing new. 31,000,000 traded and holding at 25.

Why would they want to lower the market cap is the real question. Why? To make it more attractive for a takeover? To facilitate acquisition of shares at a low price to help short traders?

Management know that receivership is likely as they cannot pay the wages, service the debt or capitalise the backlog. They had no choice, they had to release the RNS and downplay the crisis. They are trading while insolvent.

What has changed is that the pump and dumpers have made a fortune.

It is possible that an asset sale could limit the dilution significantly. The market is still valuing the shares at 25. The issue is liquidity and the cost of that. An order backlog is just the promised land and not worth a carrot. My reading of the RNS is that they have achieved nothing and are treading water at best. In days past this business would have been taken over and the entire management kicked out. Now? Sadly, it could just go bust.

Most PIs are now averaging well over 25 so will sell at a loss. So effectively the pump and dump has locked a lot more investors in who have no option but to hang on and hope. Our only real hope now is a buy out at 30 - 50.