Capricorn Energy Share Discussion Threads

[nigelpm] 07/6/2022 09:39

Yes - it's an interesting situation. Something similar lining up at SQZ also I'd suggest - £400m of cash with market cap of £700m. Our friend emptyend made a really good point recently that there was simply little point in many of these companies being listed on the markets - I think he makes a reasonable argument - they are simply not being sensibly valued. I do like these situations though - provides a level of safety when investing.

[dunderheed] 07/6/2022 09:35

I know Nigel - you have been "banging on" about it - but their strategy did not seem to be working ie the purchase of shares?
Also it "seemed" to give an impression they didn't have a clue what else to do with it - plus I've never been impressed with the Egypt acquisition personally?
However currently traded at a premium which (possibly) implies someone else interested?
IMHO.

[nigelpm] 07/6/2022 09:27

It's funny how I'd been banging on about "balance sheet investment" for months but the catalyst it needs to get people to sit up and listen is the very threat of spending the cash pile. Perhaps that was CNE mgmt's strategy - to do something bold and see what happened?

[nigelpm] 07/6/2022 09:07

To add to that I see Kite lake have gone straight in with 4.2% holding - this could yet get quite funky. With majority of share cap backed by cash you can see why.

[nigelpm] 07/6/2022 09:00

I think market probably thinking the deal doesn't go ahead - have to be honest now I've spent a lot of time researching I'm closer to log's view that it's nigh on bailing TLW out.

[nestoframpers] 07/6/2022 08:56

I think it is TWL holders buying for the free TWL shares to come.

[frazboy] 07/6/2022 08:52

Market anticipating slightly better terms perhaps? Or maybe just a side effect of the Cairn buyback - which interestingly is continuing. I reckon the latter. Arbitration opportunity for the brave, short Cairn, long Tullow.

[nigelpm] 07/6/2022 08:08

Now trading above the theoretical 3.807 TLW price of £2.04 - which is interesting

[nestoframpers] 06/6/2022 23:51

Egypt is in Africa , I was in WET we got robbed ( that was Sth A ) . Could come good here with TWLs assets ? I was just in for a quick Divi so hadn't looked very deep and know nothing about TWL.

[nigelpm] 06/6/2022 23:04

Egypt is far more stable than many parts of Africa such as Ghana and ivory coast. Don't think that's a particularly controversial view.

[oilinvestoral] 06/6/2022 22:44

Dunder:" I'd personally have been more concerned with the Egyptian country exposure - but there you go!"-------------------Totally Agree Dunder The risk posed by operating in the lands of the Pharaohs by far exceeds the risk associated with places like Ghana (where the bulk of TLWs producing assets are located). The Egyptian fiscal regime is one of the most egregious ones I have come across during my time in the industry. One wonders how someone can accept the risk associated with Egypt (who have stripped resource companies off assets in the past, deems Tullow too risky in terms jurisdictions.... Bizarre !

[tron22] 06/6/2022 19:44

Trading volume was 23 million last Wednesday and 14 million today. The share price should be way higher. At least the new management believes in dividends, unlike the num nuts at cne. Let’s hope we see a share price north of 2.40 very soon. Are we going to lose money when they convert the cne shares over to the new ones? When will this happen?

[nestoframpers] 06/6/2022 15:53

Well the share price is climbing a bit for now ! maybe it's not so bad .

[controlledmadness] 06/6/2022 14:52

maxplus - my understanding is the merged company would try to give a basic 60 million in dividends each year.
Capricorn share holders would by then be Tullow share holders and would enjoy the dividend.
Tullow las dividend was in 2019 and not regular before that.

[nestoframpers] 06/6/2022 13:57

I am not keen on African assets , dodgy place. My time here was meant to be brief just to pick up the divi's. It is all got a bit big and complicated now.

[maxplus2] 06/6/2022 12:40

I see that TLW are in line with the dividend as per RNS if the merger goes ahead. What will Capricorn shareholders to gain from the merger apart from TLW 3.2 shares?

[maxplus2] 06/6/2022 12:37

What are these acronyms defined as?

[loglorry1] 06/6/2022 11:43

Nigel I think there are much better places to put your cash. YPF 8.5% 2025s are yeilding about 16% YTM for example. FXPO stock if you want a bit of risk as there is a very good chance the Ukr conflict is confined to the east.

You might all cry OMG has he gone nuts that's far too risky but as you have now concluded all that cash that was backing CNE and de-risking it is has been handed over to evil TWL bond holders like me! I have now sold because I think there is a fair chance the deal doesn't complete and the bonds will fall back.

[nigelpm] 06/6/2022 11:27

Not really - I was working through it all over past few days - I bought as a balance sheet investment and as log quite rightly notes it's no longer that.

[dunderheed] 06/6/2022 11:16

Blimey that seems to be a bit of an about turn - did that "African" political risk upset you?
Ironically I'd personally have been more concerned with the Egyptian country exposure - but there you go!

[nigelpm] 06/6/2022 11:07

No - I didn't say that - I didn't say it was a good idea did I - in fact I sold a chunk this morning at 208p.

[dunderheed] 06/6/2022 10:39

I think CNE were at a loss what to do with the cash.

There is an argument that buying shares in a company with a potentially under-performing management team isn't the best thing to do with the money.
TLW are / were in a pretty bad state but were making progress to getting that sorted out.
They probably have a better management team, infinitely better assets and needed a stop gap to increasing value - probably better than CNE were in a position to achieve in the longer term?
I don't think its a great deal for sure - but probably better than keeping CNE "as is" and also probably a solution the major share-holders of CNE have been puzzling over for a long time - probably a lot longer than people on here realise?

Lots of probablies and of course all IMHO, DYOR and pub chat naturally!

[loglorry1] 06/6/2022 10:21

Oh right that's where I'm going wrong. Spending a load of cash acquiring a company where the value breaks well into the senior bonds is a great idea. The reason = I need to read all the presentations carefully.

Listen to yourselves. You are saying buying TLW was a better use of CNE capital than buying their own stock!

Koolaid!