Member Info for WelshMusk

You never replied to my question. Still waiting. You seem to mix terms. You claim they claim they currently have distributable reserves. So can you explain this?

I agree with other posters here. You sail very close to the wind. And frankly not sure what the point is. A bitter ex shareholder who wants to justify a realised loss?

And of course we all want to be right in our views. But you could be a bit more constructive. Be a less bitter person. And if you lost on this one, just move on or try to work out what happens from the current levels.

We are all upset with their style of communication. Things could be drastically improved. We obviously can call some things out in terms of stewardship, fiduciary duties and governance in general. You have your right to infer or speculate. But bordering manipulation is not being a good sport.

Can you run me through your theory on subsidiaries and their “current distributable reserves”

Sally, when will you allow the company to take difficult questions instead of a presentation with disclaimers stating an investor cannot rely on the information provided. Let’s step up to the plate and offer your non Nipco/AK shareholders a live Q&A session. Minority shareholders have not had the opportunity to be able to engage with your opaque communication style.

Where do you get this from?

What do you mean PLC has distributable reserves?

Hi MP,

Yes the solvency statement is sufficient alone, but you if you are a director about to sign a pice of paper that carries the risk of jail and fines, I would say the pragmatic process is to have a back up to the statement by way of helpful evidence, which in essence is to have a signed unqualified clean audit report.

Are you using a CFD or Spread betting? Spread betting you are trading vs their outside the spread quote and not the one you observe in the official market.

Not sure why you say this.

-Savannah need a signed off audit to get the courts to approve the share premium unlock.

-Re listing they specify Rule 14 that generally pertains to RTOs

Wrote on both these over the weekend.

You seem to be speculating again. And with a clear intent. Anyway, there is no SI in this stock.

Assuming AK and Nipco are acting in concert, a Scheme of Arrangement under UK Panel rules would exclude concert Bidco on the vote on 75% on quorum. A tender offer is a bit messier unless they manage to get to 75% and then apply for delisting. Only way is for minorities to reject or not tender at certain thresholds in anggregate and fight for a better price. The relisting abroad would also require a vote.

Uplisting to the UK mainboard is also a possibility.

Resolution 14 passed. Up to the court to approve the total or partial or total amount from the share premium account. This will require PKF to have an audit so the judges can see if creditors are protected. So we can assume the 2025 opening balance will be accurate and sign off of the 2025 accounts will occur fo the courts to use as evidence for their decision.

A few things on this point which I addressed earlier. The Takeover Panel requires a vote on this matter. The waiver -dispensation to launch a bid under Rule 9 of the code requires 75% on quorum to vote it through. Given Nipco is the interested party they are NOT allowed to vote. And cannot prove this but I would almost say AK is acting in concert with Nipco and they should not let him vote either. So it makes it pretty hard to pass is minority shareholders vote against this. 25% on 70% (100% shares minus Nipco’s ~30%) is enough to block it ie 17.5% of shareholders can vote against this.

The game changes if SAVE is deemed distressed under whitewash Rule 9.1, the panel expedites the process and this is the scenario that it can be done at their discretion with no vote and no obligation to launch a 100% bid.

This is not a slam dunk loan under the current circumstances as it is not seen as commercially in the distressed bucket eg 4.5% pa (although the fee is a chunky 5% which on a total draw makes it 6.1% pa assuming to maturity. The annual equiv depends on draw and term obviously). Also it is an unsecured loan so cannot be seen as a lender to a distressed party prima facie.

My point was, if SAVE get their act together in terms of audit, the working capital statement signed off by directors, have an FCA approved sponsor and file a listing prospectus with the UKLR, and under the new 2024 main market rules, the RTO presumption of suspension is no longer applicable , and with enough disclosure there is no need to cancel the listing. That was the point of my previous post. No need to relist abroad. But the audit situation has to be fixed. No way around this. Hopefully PKF will have this sorted into Q3 for the AGM. I will do my own proper digging with the listing aspect. I will call their corporate broker so they can explain to me how all this works in practice.

There also an aspect on Rule 9. Whitewashing. When asked to vote, the danger is to allow this. Nipco as a related party I would presume would be excluded from a vote. Hard to prove concept between Nipco and AK. He should be excluded from a vote too. Also I note that the Nipco convertible loan is unsecured. So not a distressed situation prima facie. Let’s make sure they don’t get cute with a back door creep up. If SAVE allows the loan to get converted assuming panel dispensation the mandatory is 8 p. One way to look at this is there could be a put price in SAVE at 8p. Not entirely negative.

You are assuming the Takeover Panel will allow dispensation and allow Nipco to bypass the mandatory takeover threshold of 30% if Savannah triggers the conversion. A clandestine creep up would be a surprising outcome.

On the uplisting subject, assuming the AIM suspension rules don’t change, it is true that the main LSE board changed the uplisting rules in 2024 (The UKLR) . If SAVE did uplist it would have to provide a few things, but no longer 3 years of accounts, would need a working capital statement to provide 1 year forward from the directors, and the ESCC admission would require an FCA approved sponsor. All hinging on PKF getting the accounts signed off (unqualified -clean) Then they can present a prospectus to the FCA

Legal tactics. The Chad lawyers will bully and go nuke to precisely push the timeline out. Buried at the bottom of the RNS they have notes 2 & 3 related to the ICC.

2 The Republic of Chad has filed certain counterclaims in these proceedings, claiming in aggregate approximately US$699.1 million (without interest and costs). SCI and SMIL believe these counterclaims are baseless and without merit.

3. The Republic of Chad, SHT Overseas Petroleum (Cameroon) Limited (SHT), COTCo and certain other shareholders of COTCo have filed counterclaims in these proceedings, claiming in aggregate approximately US$58.7 million (without interest and costs). SMIL believes these claims are baseless and without merit.

You need a high court to approve the execution of resolution 14 which requires a signed off audit and a statement of solvency. The judge will require this to allow It. What part of not clear?

I will debate. You can’t just throw in illogical arguments and not back it up. And worse, making statements contravening MAR rules. A reportable offence. If I were you, I would tread very carefully. One thing is opinion and another is making the statements as fact.

Run us through your statement of legally and contractually bound together. The detail please. I will look it up separately, as they usually create subsidiaries for different assets. But waiting for your comment first.

Also, I rarely engage with the odd obscure account that seems like a burned out ex shareholder. As I said in a previous post, seems like a way to justify the crystallisation of losses and how right the decision was to exit. Because I doubt you are shorting an illiquid AIM stock with news pending. Hard to pinpoint the ulterior motive.

Given the ICC Paris arbitration was guided for H126, and given the potential awards or settlement, the share premium cancellation would not be entirely needed. Obviously we don’t know the collection mechanism nor timing(s) for any arbitration proceeds. But what I think could betrue and subject to asking a corporate lawyer, is that approval of Res 14 by a High Court would open the gateway to upstream cash/dividends from subsidiaries (Cotco and Totco) to the Holding company. This way going forward there is a way to remunerate shareholders quicker and no need for AGM’s to approve the upstream. Not clear that the share premium cancellation is an open ended situation. Hence I need to seek clarification on this point. Will add more comments tomorrow on this subject

Hi PF,

Absolutely and a great observation regarding the auditor involvement. And I add, applying the logic this deserves, why ask for a vote that is almost a done deal given the SH register composition, if they know there is no chance a High Court judge will approve it. Logic says the creditor protection hurdle will be passed. And your comment regarding the requirement of a signed off audit with the liabilities attached to this.

Agree PF there is a logical sequence.

Exxon (Esso) have the documentes redacted when it comes details of the charges and the terms of the prepayment facility. Essentially they provided vendor financing and have secured the very assets they are selling. You see where this is going? The fixed charge was registered at UK’s CH.

You have the Esso Marketing subsidiary in the docs that is basically an offtake agreement against the oil lifted out of the Chad assets. They also own in shares/holdcos that have the asset claim in the Chad/Cameroon assets if the offtake doesn’t work. Given Chad has acknowledged that Savannah ergo Exxon will need to be compensated, I see there is a clearer path to resolve this whole mess. Please read my earlier posts describing what lead SAVE to close the Chad/Cameroon asset deals.

Let’s hope we have some good news in the coming weeks. Chad requires Capex in their country and they need to signal their commitment to attract O&G talent and capital.

There are various AIM rules regarding listing. SAVE was suspended at NOMAD’s request under Rule 14 which deals with Reverser Takeover Mergers (RTO) like Chad and Sudan. It was also suspended for the delay in annual accounts like Rule 41,19.

But the bold statement that AK will go dark as you refer above requires a shareholder vote at 75% threshold under Rule 42.

Resolution 14 will require a Court to approve the distribution and check that creditors are protected and also that SAVE is adequately capitalised.

Nobody is denying we need clarity on ECL’s (receivables) which there is an element of government will to address and solve the problem.

Have you read the Exxon (Esso) loan documents?

The Chad arbitration will be silent for obvious legal reasons. But you fail to point out that Chad has admitted Savannah is owed compensation.

So it is important that there is a balanced view. Not understanding these motivations to instil sheer fear into current shareholders. I find it frankly irresponsible. More so if poorly researched. State that these are wildly speculative hunches and not based on any deep dive.

If you are a burned out shareholder who sold at a loss and now wants to feel ok about the exit then I suggest you move on. Do everyone a favour and be constructive if you are still a shareholder. Your statements could be construed as market manipulation under certain FCA rules.

Yes if the share price is below the strike price on the expiry date then the owner of the warrant would rationally not execute it. This is obvious. But this has nothing to do with a warrant’s value beforehand and in this case years before.

But the warrant has value beforehand and the all the Greeks plugged into the model gave the warrant the £1.3 mn value.

Continuing to wildly speculate when there are certain aspects of the claims that don’t wash, is not fair nor prudent for people who read these forums.

Nobody is happy with the share price and certain management decisions. But making up a narrative is not welcomed. Commingling a collateralised/margin loan as potential evidence at the ICC arbitration is a stretch.

Pretty misleading narrative. Warrants are options and options have value. The “might” you refer to is not correct. Any rational investor would exercise a call option - in this case a call warrant if the stock is trading above the strike on exercise dates. The warrant is clearly deep out of the money. But it has option value using options valuations (in this case by a 3rd party and pretty reasonably transparent given the models used to value). So the warrant premium is worth £1.3 mn when the transaction happened. Plus the purchase of shares was on margin ie. Loan against the shares paid over 6 years with a PG attached. The BDO audit issue solely honed in on the Nigerian subsidiary internal controls. The rest is pure wild speculation.

Getting the resolution approved is one thing, but the Courts have to ultimately approve it. And they are mindful to defend creditors ranking above equity holders. So why bother doing this if a court blocks

it. Some people on this board speak about SAVE’s liabilities with Exxon as the reason for this. The courts would see thru this. So why try in the first place?

I will scan the new Articles of Association to see if anything ties in with Res 14.