RE: Q / Is it inevitable we get Taken Over ?14 Jun 2021 10:19
The dividend strategy doesn’t quite align to setting up for a takeover? Hopefully they don’t, I’m happy having my money running in here. If i3e get production up to 15-20k with a good mix of liquids, then be happy to start thinking about takeover at much more attractive pricing.
Did anyone get to the bottom of who is the "independent board of directors"? Does it exclude Peter Secker and Mark Hohnen as they operate the company on a daily basis? This is my understanding and perhaps they may throw a curve ball when allowed to speak freely if an offer is tabled?
RE: Meeting between us and the CEO10 Jun 2021 20:42
Great, well done for organising this Dee. Surprised Peter agreed to it but I guess he had to really when your essentially representing circa 5-6% of shareholders. I think there’s enough there to block the deal and just hope Robecco and Hanwa join pi’s. Suspect M&G will be aligned to the board.
It's very clear here that it is the liquid/ gas ratios holding i3e back and it seems the board is acutely aware. When they get it closer to 50/50 mix, then the operations will be taken more seriously by the market and the bottom line.
Apologies I've posted a few times this morning but I thought the pi's need to get together to present a list of agreed questions to the board. Is it worth starting a thread? Delivered as a single, considered list, it makes it harder to ignore certain aspects.
"The formal business of the AGM will not deal with any matters pertaining to the possible offer.... On conclusion of the formal business of the AGM, the Directors and advisers will conduct a question-and-answer session on any other matters that shareholders wish to raise." - to me this reads as they will answer questions on takeover, just not as part of formal AGM.
"The Bacanora Independent Directors view the Possible Offer to be an attractive proposal" this statement still sits badly with me. 67.5p when latest broker note by VSA has 120p price target. I have emailed Peter and Mark this morning, expect a standard response but good to keep pressure on. They need to be held to account.
Agree John. Although I think we all knew it deep down, reading that circular just confirmed our board are backing it and I suspect that will have approval of the ii's. I stand to make 27% profit, only due to averaging down since 2019. Peter Secker should be embarrassed at his management of BCN but he will be off into retirement now, Barbados no doubt.
continued .... "The pricing of this possible transaction is estimated on the basis of the non-binding quotation issued by Bacanora," - not sure what this entailed but sounds like they asked us how much and 67p was the response.
To rub salt into the wound - "In the event that a formal offer is made and the transaction completes, the transaction will have minimal impact on the Company’s financial position"
Ganfeng's circular relating to the takeover vote has been uploaded to their website today with some interesting notes.
"Shanghai Ganfeng and Bacanora jointly entered into an offer agreement, the main terms of which are as follows". "The subscription price for the possible offer was determined by both transaction parties after arm’s length negotiation with reference to the valuation of the Bacanora group and recent historical transactions."
BCN JOINTLY entered and negotiated this deal - the board gave the impression in their announcement and follow up emails that this was a notification of a possible offer, not the result of a "negotiated deal" that was "jointly agreed". Some answers required...
Note the vote details that Ganfeng can not offer more than £190m without another vote.
Tony - just copying my post from a few days ago but board gave their opinion of value (based on next years revenue stream minus any additional wells that are added). My target for next year is 14-23p, so agree 19p is high by year end - I’d be happy with 14p. Minus Serenity of course.
“My biggest take away was Graham stating Canadian oil producers are valued in the market between 4 and 7 times NOI. This acquisition would bring i3e up to $34m planned for next year. Therefore, on market metrics the mcap should be between $140 - 245m (£99 - 173m) or between 13.7p and 23.9p. This is without Serenity, which also sounds like a done deal”.
Johnpwh - Ganfeng could simply keep making offers and marginally increasing them. You are right in that it doesn’t make sense and I’m not well enough versed to say what the takeover code will demand. However I have been involved in takeovers that have had the first offer rejected and there was simply an increased offer two weeks later. It was recommended by the board and passed. Critically for us, any offer that is recommended by the board typically gets shareholder approval.
Where we are different is the board simply aren’t aligned to shareholders. The board should of knocked back any discussion (or noted it lacked value) at 67.5p. I think realistically if the offer is rejected then Ganfeng would only come back with at least 15-20% extra, as they know anything less is not worth the time. All rests on M&G.
If the bid is rejected by BCN shareholders, Ganfeng can increase it as soon as they like. It’s just a case of changing the number on the RNS. Happens a lot during hostile takeovers. Only issue for us is I don’t think this is hostile, our board are in cohort.
Our board are acting terribly. Allowing Ganfeng to request shareholder approval PRIOR to putting in a firm order is not the way it is usually done. They are allowing Ganfeng to strengthen their hand here at the expense of BCN shareholders. I'm really tempted to sell today but would just be cutting of my nose to spite my face.
Will be extremely disappointed if our board allow Ganfeng an extension to the deadline. When these timescales are set in takeover code's, it annoys me that companies wait until the last day - the 30 days is somewhat arbitrary to the process. Are they hoping shareholders will just be relieved an offer comes in? Have they been in negotiations with ii's/ the board? Who knows but it is encouraging to read below that M&G are recognizing the cheap transactions for 'British' companies.
My biggest take away was Graham stating Canadian oil producers are valued in the market between 4 and 7 times NOI. This acquisition would bring i3e up to $34m planned for next year. Therefore, on market metrics the mcap should be between $140 - 245m (£99 - 173m) or between 13.7p and 23.9p. This is without Serenity, which also sounds like a done deal.