Aurelian Oil & Gas Share Discussion Threads

[lammergeier] 13/11/2012 08:50

Greenroom78-its early days yet,the arbitrage traders are causing the wild swings.
By the first acceptance date,whenever that is,both AUL and SLE will be trading higher if stock mergers move as they normally do.
Anyhow as 47% have already accepted the deal,its not going to take too much
effort to get a controlling interest.Drillbit news from SLE may be the catalyst to get both shareprices moving North.

[greenroom78] 13/11/2012 08:41

Markets clearly showing they disapprove of this deal from both sides of the fence.

[ssunn] 13/11/2012 08:30

SLE have some Irish assets which is what has sparked the huge interest in PET and (less so) EOG. Hopefully AUL shareholders will benefit as a result.

[hulltiger] 13/11/2012 08:15

Thank you Greenroom but other than that sit back ok.

[greenroom78] 13/11/2012 07:47

Hulltiger. There is no such thing as 12.47p that was the spot valuation based on the closing prices, the valuation you should focus on is 1.3x SLE share price.

[hulltiger] 13/11/2012 07:32

So if like me you bought at the right time and are happy with the 12.47p and the SLE share split then it is sit back, keep an eye on the SLE share price until the shares are changed over in January. Is it as simple as that?

[new tech] 13/11/2012 00:22

All the information you will need about San Leon can be found in my thread heading:

[greenroom78] 13/11/2012 00:04

There has been a lot of talk today about pricing and discounts but very little about what San Leon are bringing to the table.

We know AUL has cash (around 8p per share) and Siekierki which in its current state we know little about its accurate valuation without seeing the outcome of the Strategic review, in addition to this we have some smaller licences/resources.

So what about SLE? I know little about them TBH, I did look at them 2-3yrs ago but remember very little.

This is probably a good place to start.


There is the Polish links we were told about in today's RNS/Presentation, I won't go over those.

They have a small carried interest in Barryroe (4.5%) which is an Irish asset I am familiar with after researching PVR. On top of this they have additional Irish licences in a fledgling (but exciting) under explored area of the Atlantic shelf.

There Moroccan Licences carry value and these are something I am familiar with as they partner SQZ where I am invested. Morocco is another under explored region of the Atlantic and has seen several larger caps move in recently (partners include CNE and GENL). These deals lead to a carried drill.

Spain they appear to have large on-shore Spanish acreage, I know very little about Spanish oil if I am honest.

They then have Albania which includes a discovery (wet gas) along with further undrilled prospects.

Not sure what their current cash state is but I'm guessing with their low valuation that cash was a concern.

I posted a link earlier to a Fox Davies 'buy' note for them (a flash note) but the second page gave a useful breakdown into the NAV of the various assets. We could really do with seeing the Strategic review for a more up to date valuation of our assets. If we had this we could assess a combined NAV for a single enlarged company.

[greenroom78] 12/11/2012 23:41

Problem is if they have sufficient II backing then not a lot can be done about it.

It is now a case of establishing what the sum of the parts look like. I do have a bit of a concern that the new company will have a very bloated management structure.

[chrismez] 12/11/2012 23:27

Secondly 12.5p doesnt really seem to tally with what most believed was a company trading at cash value with nothing added in for the assets and which in reality should have been trading in the 20's at the very least and probably a good deal more than that. More I look at this - the less I like it.

[greenroom78] 12/11/2012 16:57

Which is a 6% discount. No matter how you dress it up the discount is still the same, and I don't doubt that. As I said you'd expect a discount between the two to reflect the 'risk' of it not happening.

Personally I'd have preferred a different deal but this one isn't the end of the world (as I'm in from under 9p).

and yes, I have read the RNS.

[bones30] 12/11/2012 16:56

> SLE is one of the most undervalued companies on AIM in comparison.

You could argue that this was a clever move by SLE as it values AUL assets at close to zero, but was an alternative to raising capital which SLE would have likely have had to have done at a pretty horrific discount to the share price. This is, I suspect, the reason why SLE's share price was/is so low. So in a sense this was a cheap way to get some funding together.

With the funding shackles off perhaps SLE's share price can now make progress, which in turn will reflect favourably in AUL's.

[johncraven] 12/11/2012 16:51

Still SLE should be worth far more. Look at their assets! SLE is one of the most undervalued companies on AIM in comparison.

Both companies are merging to realise much more value as a partnership not to mention all the opertunities as partners. The purpose of the merger is to bring value, have you read the rns?

Closing prices AUL = 10.25
SLE = 8.36

Based on example 100,000 shares:
100,000 AUL X 10.25P = £10,250
130,000 SLE X 8.36P = £10,868

To get a valuation of £10,250 for the SLE holding on 130,000 shares the price would have to be 7.88p.

SO 7.88P is equal to 10.25p Aurelian so SELLING AUL at 10.25p is like selling SLE at 7.88P!!!!

[greenroom78] 12/11/2012 16:35

No you're not. If you sell your AUL shares at 10p you are selling them at a 6.8% discount to their value in SLE.

i.e. Spot price is 10.73p you are selling them for 0.73p less than they are 'worth' which is a 6.8% discount. 'Worth' is the key word in that sentence as you have to wait until next year to get your SLE shares and who is to say what they will be 'worth' then?

Please DYOS

[johncraven] 12/11/2012 16:27

And really if you selling AUL at 10p your selling your POTENTIAL SLE shares 30% less than the current market price over on SLE. LOL

[johncraven] 12/11/2012 16:23

Greenroom78 - OR what if, as SLE are an extremely undervalued company with HUGE assets the price of SLE rises which it should do to say 20p by next year AUL shares will be 1.3 times that!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

[greenroom78] 12/11/2012 16:22

The deal is you get 1.3 SLE shares for each AUL share you hold.

The current SLE price is 8.26p (bid) so the spot value of your AUL share (in SLE terms) is 10.73p

[hulltiger] 12/11/2012 16:18

John that is a mystery to me if we sell out the price is 12.47p changed into SLE shares at 9.59 times 1.3 per AUL share even at the current levels that is a big profit...or have I got it wrong? Further more if that be my plan all I need to concentrate on is the SLE share price even though I have only got them in kind..looks like the future could be ok.

[greenroom78] 12/11/2012 16:18

Because, maybe they don't want to hold SLE or they feel they can make a better return elsewhere before they get their SLE shares (which is not until next year). This has gone from a case of holding AUL for a potential (unkowon) deal to a case of holding/selling or adding based on the deal you now know about.

[johncraven] 12/11/2012 16:12

Trying to work something out in my thick head.
To make it simple if I had 1m shares

1,000,000 Aurelian shares at 10p is £100,000

SLE are offering 1.3 * the amount of Aurelian shares so I will hold 1,300,000 SLE shares. 1,300,000 shares time their price of say 8.3p = £107,900

£107,900-£100,000 = a profit of £7,900 so why would anyone in their right mind sell AUL at 10p????????????????????????????????????????????????????

[kaos3] 12/11/2012 15:57

Why sle is down today? On a good vol?

[dahmmy] 12/11/2012 15:56

3. Soros has influence, has he ever not had his way?

My gut feeling is that this deal had been planned for a while..