Member Info for romaron

Thank you oldpabear. There is a similarity then (for example) to North Sea licenses with a threat of 'use it or lose it'. They are cheap because to use it needs lots of capex and all that entails. I realise that the Verizon purchase of Straight Path for its spectrum is probably not a good comparison example as a spectrum covering USA will be more valuable than spectrum in Africa. But there is a value there by the sounds of it and we've completed our part of the bargain by the looks of it. I'm cautiously optimistic.

Hi WO, I wasn't trying to compare ISAT to AVN but they are aware of each other and do talk in their small world. I don't know enough about satellites to see why ISAT might want AVN, bits of it or none at all. They did kick the tyres once before so I guess at the right price they'd pick something up. I also asked if spectrum had any value and I'm guessing little or none. HIS summed it up with the 'build it, they will come' approach and I mentioned before, this spectrum is a bit like STOOIP and mostly not commercial and likely to stay in the ground [oil]. Because of this it is cheap to acquire like oil exploration licenses. We've built it and are waiting confirmation that customers are coming? (this also involves the positioning and commissioning sign off). By its very nature this is a risky approach but there is also the old adage that 'build the best mouse-trap and the world will beat a path to your door'. No doubt H4 has its uses and fans but will there be enough?

My other comment was that rightly or wrongly ISAT turned down the approach from Echostar. There is no holding in ISAT large enough to force the board to sell. That is not the case with AVN.

The likes of Solus have lost a fortune and will see the situation differently to AVN management. They aren't sentimental.

Hi MO, I've a few of these too. Unfortunately countries tend to trump companies and India has something of a track record with this sort of behaviour. There is usually some behind the scenes leverage that can be applied so I remain hopeful. Then there is of course International law but apparently ownership is 9/10ths of it.

Be Lucky

No, it's still there Fri 12.00 and I don't think you can remove posts yourself. If you've got me on filter and logged in the post disappears. It's how I make the board more readable.

I don't know whether the tentacles of this Isat (potential) deal reach as far as Avanti but I noted a couple of points that might be worth discussing. ISAT may have entrenched management and lacks a key shareholder. Lansdowne, Jupiter, Artemis are all big but none big enough to lead the negotiation. Avn are different.
Then there is this from RBC 'in our view, the offer is a ‘low ball’ one, especially given the potential £10 per share of spectrum value that we believe Echostar could derive from owning Inmarsat."
We own spectrum rights but are they worthless? [It has rights to orbital slots and Ka-band spectrum in perpetuity that covers an end market of over 1.7bn people.] Perhaps a poster who understands these things could comment as I don't intend to become a google expert in 10 minutes.

HIS, your points are valid. However, at the time the statement was made I feel it was 'pour encourage les autres' and seems to have done its job. The people that counted (not us smaller PIs) understood this and they are the ones that matter. As they are on the Board now they don't need an update and I'm afraid that it matters little what we do or say; the die is cast.

They've moved on from that statement on 9 April and so should we. The financial situation has improved from the stated position in the RNS otherwise they would have had to produce a fresh RNS. Perhaps the lack of one is a good sign! Better to call or write to the company than moan on this echo chamber.

Relax. I believe there was some arm twisting and persuading going on at the time so the tone of missives was to persuade the reluctant and what might happen if they caused trouble. I contacted Investor Relations mentioning this important date mentioned in the 9 April RNS and asked "As we've passed this milestone can I take it that we are now in the clear?"

The reply was "Yes that’s right."

A RNS is not necessary at this time imo. I suspect there is plenty going on in the background.

Thanks for the info MO. Magnus looking sickly. At that rate if we sign the dotted line for the remaining 75% we'll be in hock to BP for a huge note/mortgage that will hang over us for over 10 years and that's at current oil prices; do you think they'll change in 10 years? Unusually we'll know more about this particular field because if the deal does progress they'll have to enlighten the market.

*Imminent is 40 days and nights so far. I know how Moses felt.

I believe it is a good time to invest in the North Sea (INEOS are) so would say yes. However, as always the devil is in the detail:
"Under the terms of the agreement, EnQuest has a further option, exercisable in the second half of 2018, to purchase BP’s remaining 75% interest in Magnus, a further 9% interest in SVT and the remainder of BP’s interests in the associated pipelines for a consideration of $300 million. Under this option, after the recovery of consideration and adjustments, BP would also retain 50% of net cash flows from these assets, up to a limit of $1 billion. The consideration for this further acquisition would be met by EnQuest through a mixture of cash and future asset cash flows."

Does that mean we will be the operator and BP a 50% partner? A billion is still a lot of money and the Magnus 2P reserves aren't infinite. If they find more reserves and bring in EOR then it would be a different story I suppose. Best leave it to the experts. Taking the 75% would be confirmation that Enquest is sound as I imagine BP and OGA wouldn't like to be embarrassed. On balance I want to see it happen. If we are to compete we need scale.

I too would be interested in the analysis as most of these things are in my experience click-bait and tip sheets. They are usually only after contact details.

Thanks Robbie, I'm a firm believer that self-interest is a big driver of decision making and a platitude from Europe about making Africa self-supporting will ensure that 'development' funds will be directed to that end. Of course reducing migration into Europe will reduce whilst more direct efforts to block migrants are put in place. Africa is a land of disasters. Not a political comment but just the way things are.

There was a dialogue with Facebook in the past but the demands from them were considered uneconomic (from a discussion at an AGM). We know how Facebook loves to pay tax and a fair price for data. They will continue to sniff around but with Paul Walsh at the helm I doubt they'll get any handouts. Its my opinion but I think the earlier approach from Facebook was opportunist and the fact that their business wouldn't fly because they're suddenly connected in Africa means they're lukewarm like most companies toward Africa but contribute to the narrative about the "potential" of Africa. More prosaic investors (China) accept it will be a long haul in Africa and so do I. What does have a bit of traction is the future of immigration from Africa to Europe. I think that will drive internet penetration to make the Continent self supporting and reduce the pressure of migration. Whether it will work or not is another matter. Of course the military side of things will always want a view from on high ground and you don't get much higher than space.

From today's FT:

Bank of America Merrill Lynch upgraded Cairn Energy to “buy” from “neutral”. The explorer’s five-year dispute with the Indian authorities over capital gains tax is reaching the final stretch, with the arbitration case due to be heard in August. The dispute led Cairn to freeze its 10 per cent stake in Cairn India — at the time worth around $1bn — so a successful outcome could trigger a special dividend, said Merrill, which added: “Arbitration may be the most material catalyst in sector in the second half.”

Winning the tax case would boost Cairn’s sum-of-the-parts value to 330p per share while defeat would cut the valuation to 250p, said Merrill. Its price target split the difference at 290p.

It looks like Eutelsat did a quick reverse and are no longer interested. What is interesting is that Echostar bought some of the convertible to give some protection against another bid https://www.investegate.co.uk/echostar-corporation/rns/form-8--opd--inmarsat-plc/201806261105226098S/
All above my head but it does indicate that there is always more than one way to skin a cat. I wouldn't be surprised if a company interested in Avanti wouldn't make a call to Solus and other reluctant equity holders. The public quote for Avanti and the risible amounts being traded make the price meaningless imo.
The Viasat contract is encouraging.

If you look at the Inmarsat site they have had 21 RNS today and counting. Obviously all to do with the Echostar approach but unlikely that Avanti won't feel the ripples. In fact the AVN RNS's started at the same time the news was released. Now I would describe that as a causal link ! Either I've been spending too long on bulletin boards or reading GCCR posts has finally got to me. ISAT was talking to AVN and that in itself is not unusual. However, we do own spectrum and have a latest satellite in space. I realise that owning spectrum in Africa is a bit like the measurement of oil STOIIP which sounds great but mainly stays in the ground because it is not commercial to produce (Gatwick Gusher). What is worrying is that it seems the AVN people are in the dark. The good news is that maybe it's serendipity at play which even Avanti Directors cannot mess up. It must be mighty frustrating to a hedge fund to look at AVN and realise they cannot play as there is no liquidity. They could be finding other ways to get a foothold? Romaron - still in the mushroom Club.

I have been saying for some time that a wet finger in the air might produce a more accurate price. That may sound glib but I was involved in trading FX and it was an occasional ploy to leave the wrong price alone in the market. You'd be amazed at how many people would use it as a crutch when quoting an illiquid period or in a thin market. Why touch a $10mio dollar price when you had Goldman wanting minimums of $100mio? I'm not saying this is the case here or even that there is anything going on. The market in Avanti died some months ago so perhaps I'm verging on bb paranoia but there are areas I'm unclear on. The company is in the bunkers and on 13th June were even unaware of the 6 RNS's issued at that time. This is unforgivable in one sense as it is sloppy and there is a cost per RNS. IIn mitigation it may be of course that the mp is of little consequence at this time and anyway, the company has little control over it. It may be just a regulatory glitch and unimportant in the scheme of things. For the conspiracists maybe somebody can translate this. Remember these are midday auctions not the usual fat finger, price affecting news or leak reaction that occur at odd times; or first and last auctions at opening and closing. I am awaiting some clarity but not holding my breath to an email I sent some days ago. " London Stock Exchange announces the introduction of the new scheduled daily SETS Intra-day auction for equities on Monday 21 March 2016. The new Intra-day auction is a Midday price forming auction mechanism for trading larger sized orders. Participants will benefit from: · Opportunity to take part in a price forming liquidity event, timed to coincide with the traditional low point in daily volatility, and exempt from the MiFID II double volume caps in dark trading · Only Level 1, top of book data, visible during auction, limiting market impact of larger sized block orders · Provision of mid-day price formation for products and portfolio benchmarking, removing the need to use last or mid-price ===== I am confused. The exemption from MiFID suggests a certain opaqueacy and although it is level 1 pricing do they have to record the trades done at this time? The amounts traded have been tiny for months and I thought that illiquidity was the cause of these RNS's or could it be a vehicle to get larger amounts traded? They say that this Midday auction is to facilitate trading larger sized orders. Very often an RNS is a CYA response from Directors and officials who like being Directors and don't wish to breach Governance rules. They may be automatically generated but bearing in mind the fragile finances of Avanti this might indicate sharper operators are building or reducing stakes. Something isn't right?

Hi MO, I wouldn't get too excited about the triple witching. Market professionals are overloaded with news and data but insights into what is really driving the markets are often difficult to obtain. What is really driving oil at the moment isn't ever easy to decipher either but here's a couple. MbS and Vlad seemed to be getting on famously at the football and you can't help feeling that Trump wouldn't have been able to sit still for that long. However, he remains the biggest bully in the playground and that alone gains him some respect and leverage. They both (SA/Russia) have huge budgets to fund and on the radio it says that Saudi Arabia is spending $5bio a month on the war in Yemen (that's $60bio a year!). I then read that Venezuala (world's biggest reserves) are importing 60,000 barrels of oil a day and you can fill up 10,000 tanks of cars for £1 (source: The Times & the effect of 25,000 per cent inflation). Does Trump's threat of tariffs and cratering world trade mean that they'll increase production? Will Trump cut off his nose to spite his face? Personally, I haven't got a clue but remain hopeful that at some stage common sense becomes, well, more common.

Hi Squif, this may be immaterial so just throwing it in. We were told in conversation at the AGM that Enquest had been notched up a grade by a ratings agency. Others there may remember it better than me but from ( failing) memory I think it was the Caa1 to Caa2. I used to know quite a bit about Moody's and was in fact out last night with an ex-employee of theirs but I do know they have a complicated fee structure. A lot of companies, for example the big banks, won't pay so there is a kinda stand off with Moody's telling them why they need to subscribe and the big companies saying 'we don't need you'. There is an element of sell side analysis to their work and we know they're a dying breed. Enquest would almost certainly pay and it could be that other subscribers could have known of this upgrade up to 3 weeks ago. I think it is an excellent move and not because of sentiment, just that Moody's formulas make this inexorable. As Einstein said, "compound interest is the eighth wonder of the world" and the bricks are being laid as the company heals. This upgrade is a big event imo. The tide has turned.

Hi buko, if it's all so hunky-dory then why have we had 6 price monitoring extensions in the last 3 trading days which have to be RNS'd. It's hardly normal? I have never trusted the reporting of trades but pay attention when companies issue RNS's. They are not an indication that it's all tickety-boo.

It appears that they aren't even keeping up the pretence of AVN having an orderly market. We know there are hundreds of millions of shares available but they are largely held by the bondholder/shareholders and are basically lock-up paper and the few PIs left have them in a drawer and will see what the Gods will bring. The only reason we know this is: (a) the pitifully small amount traded (b) the spread (c) the AIM rules that mean we have an auction any time there is a mismatch which is almost a foregone conclusion with the current amounts and spread. These then have to be reported, hence the RNS's! We still have a Nomad and a rule of AIM is that you must retain a broker at all times. The current situation makes it uneconomic for the broker and they aren't being helped (it seems) by the company. Each day it appears that AIM isn't really in their plans. When something is no longer needed it tends to be forgotten and overlooked. The share price is no longer indicative of anything imo and it's either the Directors have thrown the towel in (without telling us) or a plan (good or bad) is being prepared. It smacks of poor governance to let this charade continue. Perhaps the dénouement is closer than we think!