Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
Logically the oil price crash has now in my mind cemented my opinion that it is now a question of WHEN and not IF this company will be taken over. The oil price at 50-60 dollars allowed the CEO and BOD to cruise along and pay themselves well for the last 3 years while shareholders and Institutional Investors (who hold 46% of the company) have seen the share value crash.
I believe there is some hedging in place for the Loan facilities but if Oil remains at 30-dollar range Lek will eventually have to adjust their business model which is not sustainable at these prices.
The major benefit that Lek have always had and why I continue to hold is their impressive asset base (especially OPL310) these assets are coveted by their competitors in Nigeria and with the current market conditions they are extremely vulnerable to a bid approach. The following values come to mind:
50 Million pounds = 9.3p
75 Million pounds = 14p
100 Million pounds = 18.6p
150 Million pounds - 28p
I previously stated that I believed they would be taken over close to their NAV between 18.6p and 28p however based on the current market conditions I think they will be bid for between 9.3p and 14p.
All opinions based on what is out there in the public domain. Seplat are currently in closed period and exit aground the 24th of March 2020 so we may not have to wait long to find out.
In these market conditions I doubt they will now get the funding they require to move OML 11 and OPL 310 forward; so, an asset sale/ merger or takeover are highly probable outcomes in the near term.
GL ALL,
OMITC
I expect them to deliver a monster RNS this week to make up for their massive balls up! Whatever they say it does not change the fact that a lot of shareholders got shafted.
The major positives from this RNS is that Mark Simmonds and Tony Hawkins are still on board and it feels like they are releasing this to draw a line under the whole saga; before they embark on the next major move which may be very positive....
Next news this week...just a feeling...
Agreed Danker. This should be the start of positive news flow... and there is a lot of it built up yet to be released...IMO
This starting to look and feel different to previous rises that have faded the next day...news due on muliple fronts:
1. OML 11 - Otakikpo production expansion finance
2. Investigation update
3. OPL 310 - JV partner - Farm out
4. CFO Board appointment
5. Selling Assets - Offers to Purchase OPL 276 - OPL 325
6. Production Update - Next Lifting
7. OPL 310 - Site Survey Update
8. CFO Board appointment
9. Take Over - bid approach Addax/ Seplat/ Other
take your pick or a combination of the some of the above...
OMITC
Could be a leak as this rise looks to be sustained...official news due by Friday just a guess...lets see what happens over the next few days.
Hi Danker. I am sorry I did not respond to your question directed at me from last Friday as I only read that message now. Unfortunately I have absolutely no social media presence, but you can get me on this board until we are taken over...glad you are enjoying the material it really is an eye opener in this business knowledge and looking at things from many different perspectives is vital to success.
I think E_AL was correct when he stated former Addax CFO for almost 10 years was bought into do due diligence. I am strongly supporting that theory now because is does not take 7 weeks to appoint a new CFO to the board!
There is something going on in the background but most of us are in the dark to what is actually going on we can only theorize based on the information available in the public domain.
Addax or Seplat....toss a coin.
Omitc
15p to 20p could be a starting point Five Candles...cheeky based on Lekoil Assets but the BOD have not helped themselves one bit and they deserve to be taken over!
I have shared my thoughts on Seplat Take Over of Lekoil for a while mainly based on the following press articles:
1. Seplat Take over of fellow Aim listed producer Eland Oil announced on the 15th of October 2019:
https://www.offshore-technology.com/news/seplat-petroleum-eland/
This was based on the synergies and the production Eland had managed to bring online since listing.
2. Less than a month later on the 7th of November 2019 an article was published in the Nigerian press stating Lekoil was panicking about a rumored take over from Seplat:
https://www.vanguardngr.com/2019/11/lekoil-stakeholders-panic-over-plan-to-covet-assets/
The article is interesting as it slates the CEO and BOD for not achieving the potential of their assets but more importantly the major shareholders are not satisfied with the performance and broken promises...they would rather sell the company at a premium to another company with a decent track record. This is very interesting as if you look at the II holding, they own about 47% of the shares the CEO owns about 7% so half the company is in the hands of major holders. I doubt that the recent QIA debacle has improved their sentiment and therefore I believe they would support an take over if not even solicit one!
3. The news article to further support this theory is a recent article published only last week stating that the Seplat CEO is actively seeking more OIL & Gas assets:
https://nairametrics.com/2020/01/27/seplat-to-acquire-more-oil-gas-assets-after-elands-acquisition/
This article shows real intent by Seplat that they are not finished consolidating their position in the Nigerian Oil & Gas market even after acquiring Eland for 382 Million pounds.
SEPLAT ARE HUNTING and LEKOIL are a VERY VULNERABLE TAKE OVER TARGET and they the CEO and BOD only have themselves to blame they have amazing valuable assets but have not done enough to realize true value!
OMITC
I have written about this and supported it with various articles... and I agree with others views that SEPLAT may just be on the verge of taking Lekoil over, the one thing I do disagree on is the price valuation of 10p/12p etc for one simple reason and that is the Institutional Investor Base.
You have to remember that the CEO raised about 250 million dollars from Institutional Investors sin IPO in 2013 and most of them are sat at averages of over 30p per share I assume based on the placing prices since IPO. So why would an ii take 10p when they hold 47% of the company stock and the assets de-risked are worth a few hundred million, remember OPL310 is a billion barrel discovery....
I think the Fair Value price that current ii would accept is between 100 million to 150 million or around 18p to 28p, take into consideration that Seplat paid 382 million for Eland and they did not have the same asset base but did have more production and were closer to ramping production up.
Time will tell but 10p is not going to be considered by this BOD because their backers are in the RED and they will ultimately decide the price they will sell at.
OMITC
Apologies for the repeated words long week coronavirus is wreaking havoc in the real economy and the major stock markets are on a central bank liquidity high...everything is upside down right now.
This has been quoted by the uninformed a few times over the past week. E_AL wrote an interesting post a few week ago. The fact that they have not yet appointed the CFO to the board yet has me thinking Addax may also be in the mix with regards to Asset purchases or Takeover.
Remember Addax is now a subsidiary of Sinopec the largest oil and gas company in China. They also recently completed the CPR for Otakikpo OML11 recently.
What will happen next is anyone's guess the way this has been trading lately suggests nothing has leaked into the public DOMAIN yet...
Glad you enjoyed the recommendation Danker...keep educating yourself...try chat with traders..you will find a guest or two that you can relate too...always good to listen to other traders experiences makes you feel sane in this game.
I have shared my thoughts on Seplat Take Over of Lekoil for a while mainly based on the following press articles:
1. Seplat Take over of fellow Aim listed producer Eland Oil announced on the 15th of October 2019:
https://www.offshore-technology.com/news/seplat-petroleum-eland/
This was based on the synergies and the production Eland had managed to bring online since listing.
2. Less than a month later on the 7th of November 2019 an article was published in the Nigerian press stating Lekoil was panicking about a rumored take over from Seplat:
https://www.vanguardngr.com/2019/11/lekoil-stakeholders-panic-over-plan-to-covet-assets/
The article is interesting as it slates the CEO and BOD for not achieving the potential of their assets but more importantly the major shareholders are not satisfied with the performance and broken promises...they would rather sell the company at a premium to another company with a decent track record. This is very interesting as if you look at the II holding, they own about 47% of the shares the CEO owns about 7% so half the company is in the hands of major holders. I doubt that the recent QIA debacle has improved their sentiment and therefore I believe they would support an take over if not even solicit one!
3. The news article to further support this theory is a recent article published only last week stating that the Seplat CEO is actively seeking more OIL & Gas assets:
https://nairametrics.com/2020/01/27/seplat-to-acquire-more-oil-gas-assets-after-elands-acquisition/
This article shows real intent by Seplat that they are not finished consolidating their position in the Nigerian Oil & Gas market even after acquiring Eland for 382 Million pounds.
SEPLAT ARE HUNTING and LEKOIL are a VERY VULNERABLE TAKE OVER TARGET and they the CEO and BOD only have themselves to blame they have amazing valuable assets but have not done enough to realize true value!
OMITC
if nobody has a clue what i am talking about with regards to the last paragraph, please start the process of educating yourself...I would recommend realvision TV on youtube as a great place to start to understanding how the financial system works...on a macro level you could make millions.
It was interesting that the auto buys and sudden rally occurred at exactly 2:30pm yesterday...which coincides exactly with the New York market open at 9:30 am eastern. Surely not but is Mr Ron Baron buying back in?
It just twigged because I rely heavily on the New York open for my other portfolios, which is moved by the Dow/S&P with heavy correlation on most stocks especially commodity related... but on a Macro level...does not really have any impact on AIM stocks as they are mostly news and sentiment driven.
I also read that and laughed....does he think that the Institutions that hold 47% of this company are going to allow a placing at 3p and dilute all their holdings...if they did do a placing it would be at a much higher level probably after the Otakikpo finance news and that is only if they do not find the 28 million dollars for the 1st OPL 310 appraisal well by July..
Hi Danker, I see you, E_AL and others keeping the board well oiled with constructive information. Thank you all contributors may well all prosper shortly.
everyone seems to have forgotten that LEK are sat on assets that when de-risked are potentially worth 2.39p a share! Black Friday Sale everyday for the past year especially today 3.4p on the ask....lol
My gut tells me it could be the Otakikpo production expansion finance agreement...or it could just be lunch....
...is this the big one?