Member Info for optimist13

Very good article in Bloomberg, well worth reading: http://www.bloombergview.com/articles/2016-04-05/don-t-cry-for-argentina-s-investors

creeping up. I still reckon we will see circa 3.5p in the short term once the BOD deem to tell us the level of funds being repatriated from EdS in Argentina. In the mid to long term who knows where the share price will go, but with NA's of circa 8.00p and a positive forward outlook from the BOD, the share price could perform very well this year.

Countries and funds are lining up to invest in Argentina: http://en.mercopress.com/2016/04/05/argentina-and-spain-agree-to-re-launch-closer-political-and-trade-relations Extract: “We addressed all the issues of the agenda and the regional situation and decided to re-launch existing bilateral mechanisms, which have been asleep for too long”, said Ms Malcorra adding that the Political Forum, which has not been active since 2011, will again meet in the second half of this year, and “we will again promote private business mechanisms to work on a specific agenda”. The minister recalled that Spain was the second direct investor in Argentina but lately this has fallen considerably, thus “we are working on an investments agenda, and we expect Spain to play an active role as investor in our national infrastructure program”.

good article on the benefits of the debt deal: http://www.investmentu.com/article/detail/50064/inside-argentina-debt-deal-investment-opportunities-it-presents#.VwJKt2ErLyA Extract: A good friend of ours and the co-founder of Beyond the Dollar, Karim Rahemtulla, just got back from an exploratory trip of Argentina. It’s clear from what he told us on the phone last week that he sees big opportunities ahead. The mood in the country is changing, he admits. Investors are finally looking at the resource-rich country in a positive light. “My local Argentine contacts - not Americans living in Argentina - have been making a fortune buying Argentine debt in anticipation of this resolution,” Karim wrote this week for his popular free e-letter, The Non-Dollar Report. “For a local Argentine to buy the country’s debt is a major change in local sentiment.” It’s that sentiment that’s likely to start a long and healthy bull market. As the country overcomes a tough economic hurdle, the discounts long baked into its stock market will quickly erode."

Whilst we are paying 1% per month for the short term loan to Bridge Properties, the interest on our loans to EdS vary between 10% and 15% per annum. With the previous delay in payments, the outstanding loans and interest due from EdS will have increased from the reported figure last year and if the impairment at the half year is reversed, this will make a material difference to the NAV. The Marci government should be reporting on the issue of new bonds and the repayment of the outstanding 'vulture funds' bonds in the next few days. Whilst not directly related to Rurelec, I see this as the final hurdle to clear the way for some significant investment in Argentina from across the globe. Still cannot get an on-line quote to buy even 50,000 shares!

Still cannot buy any online at the moment. There will be no holding this back when the directors eventually get around to telling us the details of the funds being repatriated from Argentina. $2m dollars per month for the next 12 months would probably bring EdS back in-line with the original repayment schedule.

You can't buy online at the moment. Appears to be some interest following the recent news from Argentina and the MM's don't appear to have the shares to fill even small orders.

This from last year's accounts on EdS: "The major impact of the changes for EdS has been the deduction of a maintenance reserve payment each month, which we have negotiated to recover starting May 2015, thus increasing cashflow in the coming year." And this: "This improvement was significantly due to the change in the structure of the energy sales now more reliant on the Resolution 220 Contract rather than spot sales, which incur fuel costs. Cashflow was strong, allowing EdS to remit US$5.4 million to the UK during the year, however, the electricity sector is still held back by cashflow restrictions imposed as a result of the low tariffs of the two largest electricity distribution companies. CAMMESA has struggled to maintain timely payment of invoices to generators since the middle of the year." With the recent changes announced by the Marci government to the low tarrifs, they have been hiked considerably, this should alleviate any issues CAMMESA have had previously concerning timely payments to generators.

When will our BOD make some comment http://www.reuters.com/article/argentina-electricity-idUSL2N15B0SU Extract "Jan 27 Argentina power company stocks surged on Wednesday after the government set new wholesale prices for electricity that would apply nationwide from Monday, paving the way for anticipated rate increases. Power distributor Edenor's shares rose 3.7 percent and power transporter Transener were up 5.6 percent. Meanwhile, the share price of Pampa Energia, which is engaged in the generation, transmission and distribution of electricity in Argentina, climbed 5.5 percent . They ranked among the biggest gainers on Argentina's stock market benchmark index, the MerVal, which rose 3.2 percent to a two-week high. The power stocks rally followed Wednesday's publication of an Energy Ministry resolution in the official gazette of new wholesale rates for electricity starting Feb. 1. The resolution did not specify how much the rates differed from the previous level, which varied by region."

Posted previously, but a reminder of the colossal changes taking place within the electricity generating sector in Argentina: http://www.bloomberg.com/news/articles/2016-01-29/argentina-to-raise-electricity-bills-by-as-much-as-500-percent Extract "Argentina will raise electricity bills by as much as 500 percent in the greater Buenos Aires area as the new government seeks to eliminate a system of subsidies it said cost $51 billion over the past 13 years. Rates will be divided into seven categories and users who cut consumption will receive discounts while about 900,000 consumers categorized as poor out of 4.2 million consumers will continue to receive assistance, Energy Minister Juan Jose Aranguren said at a news conference in Buenos Aires. As an example of the increase in rates, he said a user who consumes 180 kilowatts of electricity per month will now pay 150 pesos ($10.80), up from 25 pesos ($1.80) previously. After Argentina posted the worst fiscal deficit in 30 years in 2015, newly-elected President Mauricio Macri is seeking to trim spending this year by reducing subsidies in energy and transport introduced by the previous government. The rise in electricity prices will allow the government to save about $4 billion this year and power companies to invest in a system that’s on the point of collapse, Aranguren said."

Good to see some interest here again. Remember, there are no cheap shares here and the company cannot place any further shares below 2.00p, which is the nominal price of the share. I think pretty much anyone selling at this low price will be selling at a loss, so I would expect the share price to move back up quickly on very few trades.

Another announcement. This time they are changing their accounting reference date. http://www.investegate.co.uk/ipsa-group-plc--ipsa-/rns/change-of-accounting-reference-date/201604010700108056T/ They seem to be ploughing ahead with their strategy, which in some shape or form , has to include Rurelec. I wonder when we will be told what is going on. One thing is for certain, they will not be able to pay IPSA the outstanding monies due to them until they have paid off the short term loan to Bridge Properties. Lets face it, IPSA are in no position to make any demands on anybody.

It certainly is. You just need to read the recent articles about the expected inflow of funds into Argentina to realise how this improves the outlook for the electricity sector in Argentina. Also, the huge increase in wholesale and retail prices will add to the bottom line of EdS and Rurelec. Interesting,, you can't buy online at the moment unless it is via NT.

GFD, whilst I agree with your synopsis, I am not sure the administrators for the Sterling Trust block of shares would agree to such a low ball offer. The Rurelec records show that the EdS business is performing well, and is likely to see a material increase in profits following the changes implemented by the Marci government through the massive hike in electricity prices. And with agreement now being reached with bond holders and the relaxation of currency rules, I believe there is a huge appetite from investors to take part in infrastructure projects. Also, I believe the company's loan book would attract considerable interest, and PE is on record saying that was one of his objectives. With a NAV of over 8.00p, when you add back the impairment of the Argentinian loans, it would be daylight robbery for the directors to agree to such a low offer as 2.00p. Just one RNS confirming the repatriation of funds would see this fly, and the directors know it.

Confirmation of the total outstanding loans and interest due and the performance of the EdS operation. From the interim results: "Review of Operations: In Argentina our 50% owned operating entity, Energia del Sur S.A., and its parent company, Patagonia Energy Limited, have outstanding borrowings and interest of £30.7m due to the Group. The company is operating well at the local level however management costs have been allowed to inflate unnecessarily."

Re Peter Earl's holding. This from Jan 15 RNS: Rurelec PLC (AIM: RUR), the owner, operator and developer of power generation capacity internationally, has been notified that , Peter Earl, CEO, today transferred 750,000 ordinary shares of two pence ("Ordinary Shares") each in the Company to his Self-Invested Personal Pension (SIPP) at a price of 4.25 pence per share. As a result of this transaction Peter Earl's holding remains unchanged at 7,000,000 Ordinary Shares which represent approximately 1.25% of Rurelec's issued share capital.

Just reading the last RNS from the company again as I was on holiday at the time of its release. I have to say the statement is very misleading to the casual observer. The company states: "The Directors are exploring how best to arrange for the Company to benefit from the cash generated by the asset in Argentina in which it has a 50 per cent. interest." However, what the statement doesn't say is that they are seeking ways to repatriate payment for the outstanding loans, plus interest due to Rurelec. As I have said before, the company has a first charge over the assets of EdS, and they are in a very strong position to demand repayment on the outstanding monies, which at the last count was $10m, but will have increased since then. The changes in Argentina are material and the company should be updating all shareholders accordingly. It is also worth noting that PE is a shareholder in Rurelec as well, and it sounds like he has been given 'insider information' to make the statement he has contained within the IPSA accounts.

Spac3y - IPSA are technically insolvent and the accounts were not signed off by the auditor. As I see it, the only way the company will survive will be if a deal is done with Rurelec for the remaining plant. However, we would need to see a large repatriation of funds from Argentina for this to happen.

More detailed article: http://www.wsj.com/articles/argentina-senate-approves-plan-to-end-bondholder-dispute-1459397812

missed a couple of words out. Should read...This will have a significant impact on business...