Member Info for shamI89

In their update in March they stated that their break even price is 45 dollars,I remember telling SuaerKraut that after premier oil Tullow could come under attack due to 3 Billion debt.Right now all speculations and results would clarify everything.

3 billion debt, Tullow breaks even when oil is 45 so it is breaking even or making a little profit.

Problem is we come across some crisis after every two years, weaker companies go out of buisness, stronger companies take over and cycle goes on. Corona Virus was a major crisis, before that brexit brough markets down and before Brexit we had Greek Crisis.It is really hard to predict right time to buy a stock.

Problem is countries cant afford to shut everything down because of corona, when first wave hit goverments took severe preventive measurements and then they realised that if they dont lift lockdowns their economies would suffer.

But it looks like it would go boue again today and may ecen hit 260/270

Did say that it is hard to predict market and you must be confidenrt, problem is rightly or wrongly people consider Rolls Royce as safest bet and that is why people bought it yesterday and it went on to hit 250.

Are you really shorting it?

It is hard to predict share price, it can go to 200 or 300 next week nobody knows.There is not such a thing a thing as safe investment on stock market but people see rolls royce as some sort of safe investment wrongly or rightly.I did not before update as any news of rights issue would have diluted my holding heavily, but in absence of rights issue I see some sort of recovery .

Having said that I believed that Rolls Royce and International consolidated airlines would be hammered and both went on to gain 20/30% after that hammering.

it was reported in Reuters that company is looking to raise 1.5 billions through rights issue and details would be announced in this update.I was following the story and it drove the price down.

Many investors including me were worried about rights issue as it was speculated to be announced in this update, danger is not over but it has bought company another two or three months.Company is in big trouble if international travel does not increase , how if it does increase then that would increase revenue.

Now it depends on if second wave of covid 19 comes and how quick international travel resumes.

I was expecting this to raise some money through rights issue and that detail shouod have been in today's update but it looks like they are trying to raise some money through disposals before turning to market.

Market is liking it, an agreement with pension trustees was game-changer, aerospace buisness is a solid profit making buisness which is growing steadily.May be one or two years down the line they can sell it

It is on the move, hopefully good results tomorrow would give it much needed boost.

I wanted to get some tullow shares but their debt is higher than premier as it stands at 3 billion and their break even cost is 45.

Dont think you understand RI correctly, Rights are issued at a discount to share price to encourage maximum take up.However in this we have another danger looming in the form of debt to equity swap if they fail to raise intended money via rights issue, so it would be upto lenders to determine what percentage of equity they want to cover the gap.

Share price was much higher last month and month before, if he wanted to pursue rights issue he should have done it then.Right now he is relying on market to determine price, secondly he is also hinting at debt to equity swap.We might see occasional 5/10% rises here and there but not expecting any sustainable rise pre rights issue and even if he failed to raise whole lenders would force debt to equity swap. Tony has killed a thriving buisness but in this case he would retain his job, lenders would get their money back and shareholders would pay the price.

Still, rights issue and debt to equity swap would dilute shareholders heavily and shareholders have already lost 40 % since then.Official statement if this can be one is opaque and complicated as they are relying on market to determine the price and market does not seem to be happy about it.

Private investors are in danger now, almost all of debt to equity swaps leave little to no value for private investors, so if they dont approve it company would be put in administration.I would prefer if company raises all money through Rights issue , that would still dilute shareholders but it is better than debt to equity swap in my opinion.