RE: Helium shows20 Aug 2024 17:25
Dia,
I haven’t posted on GEX, I hope they do well. But I looked at the prospectus when it was MMM pre IPO. I could have bought but chose to stick with HEX.
The main reason was GEX’s capital structure with the Westmarket concert party owning 61.7% fully diluted. Hence the rule 9 waiver. See page 5…
https://www.mmmplc.com/_files/ugd/5c57a6_2ea075ba74a04171a658b9f77eeb63cf.pdf
That structure is always going to have a potential drag on the sp due to the stock overhang.
There are also risks with the partner OilCo not paying their share of the JV. That’s as well as the permitting, as stated, there is no guarantee they will land the license for EP155. Page 8. There is also a longer wait for the drill.
Of course it’s all likely to play out favourably even though it’s an innovative production as so many people have put so much cash in it.
But then they will look to derisk, same as what’s happened at hex but on a bigger scale!
Remember their shares are 5p, not the float price!
The capital structure leaves the company open to shorts. Even by their own investors who can play it both ways!
I have looked at the BB there and tbh I could pull the company apart but that’s ‘not cricket’. It’s also my view that I think they have a fantastic asset and a great idea and indeed I may invest one day once I see the right progress.
But for now it’s gonna be a bumpy ride and every high will be met by selling. It seems most investors are in for a quick buck as opposed to backing the story.
GEX is open to short attacks because of its capital structure and imo that it’s IPO’d a bit too early!
But in defence of the company it’s all clearly set out in the prospectus. It’s just that too many people seem to turn to BB’s for their info rather than first reading the company information!
You see the same posts on most IPO’s where the questions asked have been clearly set out!
And of course I wish the guys in GEX all the best. I haven’t posted there but I have mentioned them on HEX as I have HE1 or Avanti for that matter as folk bring up peer comparisons or try to ramp one stock over another. They are all different propositions!
Usual caveats
Trek
Sign In
Follow the stocks
