Member Info for pauldrayton

Thanks, obviously it would be different if they’d raised money for an acquisition at the IPO and had tens or hundreds of millions of shares in issue, but it would seem they might have flexibility now. It would also give those initial investors a decent return straight away.

I guess we have to wait and see and it’s all speculation for now as you say!

Correct me if I’m wrong (which I may well be!), given that the initial IPO was just 10 million shares at £1 to get the company up & running, and it didn’t/doesn’t reflect the value of any company assets (because there aren’t any), is there anything to stop them raising finance for an acquisition at a much higher price?

Let’s say they want to raise £100m to invest in producing assets that they felt were worth more like £200m, for example, could they just issue 20million more shares at £5/share? There would then be 30million shares in issue and a valuation of £200m would be £6.67/share so they’d be getting a 25% discount to true value with their £5 shares.

Am I dreaming/talking rubbish? Just wondering how it all works given there are so few shares in issue at the moment.

Thanks.

Clearly there will be an element of equity involved but I’m very interested to see what deal(s) they are putting together and how the finance will work (how much debt & how much equity).

If their backers are willing to invest now, then they should be able to negotiate some good deals. Depends what appetite they have at the moment given the wider markets.

Strong start given the wider market. Not huge volume yet but nice to see it continue momentum.

That’s 1% of the company in one trade!

Thanks Londoner - so they have £225m cash but a market cap of only £110m. How does that make sense, unless they are expected to make a serious loss?

Can somebody please explain what is meant by pro forma net cash? The half-yearly report stated a pro-forma net cash position of £225million, and anticipated average month end cash over £100m.

What’s the difference between the two figures?

Stupid question I know but would be grateful if somebody could explain.

Thanks.

It’s certainly an ambitious plan. My concern is the dilution and what cost it will come at for current shareholders. Nothing we can do now anyway except hope for the best!

Looking strong this morning. Nice start to the day.

Hope you’re right daveri007. The volume in recent days would suggest something might be close. They did want something in H1 so they’re behind schedule but let’s hope that’s because they’ve been able to negotiate a better deal!

https://ca.finance.yahoo.com/amphtml/news/mexico-debt-laden-oil-giant-215608415.html?

I wonder what’s happening with Zama.

To me it looks like the stars might have aligned for LBE. The deals they will be looking at now will be on much more favourable terms than they might have imagined at the IPO late last year. They have been one of the few companies to benefit from these market conditions. The only question mark is whether their financial backers are prepared to invest in this market but the Board have the experience, the pedigree and the relationships from when they were at Faroe so hopefully everybody involved sees this as an opportunity. Whilst the first deal may have taken longer than anticipated, it might result in the next one or two happening quicker than expected. Let’s wait & see.

Shame that FID & sanction have been put back 12-18 months. Not surprising given the circumstances and at least all parties remain committed to it, it’s just frustrating that Coronavirus arrived this year! Oh well, what’s another year in the grand scheme of things?! 2025 it is then!

Both Serenity and Liberator also need appraising.

That would be nice but these sort of predictions normally result in a fall back!

Let’s see. I’m sure they must be working on a deal or two.

The Board of Directors are very shrewd and Coronavirus arrived just at the right time for them, assuming their institutional backers are still prepared to fund them in this climate (which I think they will).

I hope they are working on more than one deal - it’s an opportune year to take advantage of the low oil price and general sentiment across the O&G industry.

It’s a massively ambitious plan.

My main concern is the terms of the $60million funding, and also getting the Toscana vote in their favour. If they can put those together then they may be able to raise funds for a Serenity appraisal well on their own, or at least be in a stronger negotiating position for a farm out.

Nothing we can do now except hope for the best!

To be honest I don’t see much point in discussing the ifs, whats & maybes of this particular scenario. I just can’t see it happening at all.

I can’t see Apache taking over PMO. However, if they did and they weren’t interested in Sea Lion, they would relinquish the acreage and RKH & Navitas would be in the driving seat.

Can’t see it happening though.

Not that large(!) but promising to see it moving back in the right direction with a bit more volume over the past couple of days.