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PWE - Penn West Petroleum


alertmeipp

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If the 20% get their way there will not be the 10% acceleration, if they fail there will be - I'm OK with either option.

I just don't have a problem with paying up for results - no results, no acceleration.

 

SD

 

 

 

Don't worry, at the rate the market cap is shrinking, soon you'll be able to buy the whole thing and do whatever you want with it.

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  • 3 weeks later...

Wow, ugly vote. 

 

But results were good, lowering debt in these conditions.  And well performance top notch.

 

Votes: https://www.obsidianenergy.com/press-releases/obsidian-energy-announces-voting-results-from-the-2020-annual-and-special-meeting-of-shareholders/

 

Discussion (pretty clear they continue to "try" to sell this company):

https://pastebin.com/YSy52kqJ

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  • 4 weeks later...

They have been 'in play' for years.  No secret.

 

Be interesting to see if the 'gap' closes.  That might be telling

 

I know. I just don't see what they hope to gain here, and am basically just guessing. Maybe they're trying to get Bonterra to buy them at a premium, and are putting out a high ratio as a negotiating position? I'd be curious to hear what others think the motivation behind this bid is.

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I think the banks are in control.  The banks are both the biggest stakeholder in both companies.  They share the same syndicate.  Bonterra has been Month-to-Month literally in their re-determinations since March.  That is unique to Bonterra.  Actually, last night was another deadline, and only another 30 days....

 

Obsidian adds this (in bold) "We would note that we have shared our assumptions with our banking syndicate, our noteholders and their respective financial advisors."

 

 

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Most would expect that the OBE/BNE consolidation is just part of a broader consolidation in the WCSB, it's simply become time to pull the trigger on the mutual discussion of the last year. It's a friendly deal, but there's obviously an expectation of some internal resistance in the BNE sharebase. There's a steel fist in the velvet glove should it be needed.

 

It is clearly in everyone's interest to get it done - to achieve neutrality at today's prices, OBE just needs to rise to 76c (27%) post consolidation, and post news of their BCAP refinancing application. Not a big stretch.

 

Is the combined entity worth $3.50/share 1-year out? Depends on your interpretation.

If you were thinking of merging with the consolidated OBE next year - you know where the starting point is.

 

SD

 

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  • 3 weeks later...

It has been pretty obvious, and for quite some time, that this deal would very likely go ahead. The circular just indicates that OBE is confident of wrapping it up by Jan 04, and that it will receive at least 2/3 of the vote. Everything else is just trading spin. 

 

SD

 

I guess I still don't understand why any BNE holder would vote in favor? If you thought this was a good idea and you were a BNE holder, wouldn't you sell and buy 2.XX OBE instead of waiting to get 2.00 in the exchange?

 

Maybe OBE thinks BNE's banks will put the hammer down crashing their share price between now and the vote?

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It has been pretty obvious, and for quite some time, that this deal would very likely go ahead. The circular just indicates that OBE is confident of wrapping it up by Jan 04, and that it will receive at least 2/3 of the vote. Everything else is just trading spin. 

 

SD

 

I guess I still don't understand why any BNE holder would vote in favor? If you thought this was a good idea and you were a BNE holder, wouldn't you sell and buy 2.XX OBE instead of waiting to get 2.00 in the exchange?

 

Maybe OBE thinks BNE's banks will put the hammer down crashing their share price between now and the vote?

 

Recalcitrant BNE shareholders believe they are entitled to the standard 20% industry takeout premium, and that OBE cannot do it (gives >50% ownership to BNE). Their BCAP funding allows them to drill for another 1-2 quarters, show good results, and get a better offer. It ignores that their banking syndicate has to agree to continuing one-month deferrals, and assumes the bird-in-hand is worth LESS than the two-in-the-bush.

 

BNE has until Sep-30 - to either make it worth their bankers continuing 'as is', or take the bird-in-hand. It would appear that > 2/3 of the share base believe BNE should take the bird-in-hand, and that the outcome will essentially be decided by month-end. Formalities complete over October,  cap structure settles over November/December.

 

If you believe the combined entity will be worth more than the parts (& all do) - a done deal, is far more important than who gets what. Long-term shareholders just adjust their cost bases, and let the synergies demonstrate themselves. Restart drilling, show growing production, better results, and get a much better offer later.

 

SD

 

 

 

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https://www.bonterraenergy.com/investors/news-releases/bonterra-energy-corp-advises-shareholders-to-take-no-action-at-this-time-regarding-unsolicited-offer

 

I think it is 100% driven by the banks.  Bonterra is not taking up a full fledged defense strategy and instead 'waiting' till after their bank redetermination.  So literally OBE's Loukas put it 100% on the banks.  Maybe very well played.

 

I think it is a done deal. Fink (who by OBE's disclosure was being uncooperative) is not part of the independent committee to review the deal. 

 

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