Cabot Energy Share Discussion Threads

[nav_mike] 21/3/2002 07:09

Jim, OCH has become a core holding for me - I researched a lot more after your original post and really liked what I saw. Ive now bought three times (average 8.4p now) and will hold for 20p+

We are different animals in that I buy and hold but I do not envisage OCH having to be even medium term....

Really wasnt keen on TND (what did you spot in that one?) but I may buy GIN on any further weakness after the recent hype

[justjim37] 20/3/2002 23:53

Hondas,

My e mail is [e-mail]
I really look forward from hearing from you :0)
IF you send them I will post them on this thread NO CHANCE

Sorry NAV_Mike but it is so difficult to resist.
About OCH ? I'm out, big profit, but should I get back in????
Tommorow FNNER perhaps?
JIM

[justjim37] 20/3/2002 11:51

A very good trick Hondas/gracey. Neither of those sells were yours.
The ability to edit a post after the event is an old trick but sometimes
some people are still fooled.
I saw your ORIGINAL post at 8.47am which you edited at 10.05am a few minutes after the two sells you "claim" are yours went through.
Unlucky.

[hondas] 20/3/2002 08:41

Timbo

I have edited this post because my original post made me look silly!

I have just spoken to my financial adviser who tells me that this deal although makes the company look safe the chances of the share growing are just about zero because of what you have been saying!

I take back everything I have said and have sold 200k today

I think you are right

ps to prove it I sold 150k @3.61
and 50k @ 3.5

the trades are not yet showing but they are both mine they will come up later as delayed trades

sorry again for being naive

GET OUT

[nav_mike] 20/3/2002 08:01

Interesting that Winterfloods immediately opened at 3.75 bid this morning before all the other MM - havent seen that for a while

Also spread now at its tightest for a long time

[timbo003] 19/3/2002 22:59

Hondas

I think without the proposed restructuring the chances of the company remaining solvent were slim.

With the restructuring they should survive (although nothing in life is certain), the point is existing shareholders are going to have to pay a very, very heavy cost, viz

1) Massive dilution

2) Control of the company is now in the hands of Gyllenhammer (what is his effective stake if you take the convertible bonds into account? >50% I suspect)

3) What's to stop Gyllenhammer asset stripping?

4) Gyllenhammer has bought in at a 60% discount, meanwhile he will be paid circa 7% per annum on his investment which gives him a option to buy most of the share capital at 2.125p, meanwhile ORD holders will get sweet FA whilst they are waiting (waiting for what some might ask).

5) Proceeds (due to ordinary shareholders) on the sale of certain assets (presumably the most valuable ones) are capped (excess proceeds following sale go to Gyllenhammer), therefore it is pointless comparing the current market cap and the published net asset value of the company in order to get a feel for what the company should be worth, because proceeds from the sale of assets would not necessarily go in the direction of the ordinary shareholders.

I just cannot see any appreciable upside from here, I hope I'm wrong, but I suspect my prognosis will be proved correct on this occasion.

[hondas] 19/3/2002 22:25

ps timbo whoever you are

why would anyone invest in the first place and restructure debt if they were to go bust!

dont you think that todays statement says it all

CONFIDENCE AMONGST ALL

[hondas] 19/3/2002 19:47

disagree

sorry but that is my opinion

plus gracey is right

[timbo003] 19/3/2002 19:05

Gracey

Directors are putting their money in at 2.125p/share, not the current asking price for the ORDs which is 4p (there is a difference you know).

Furthermore, should the company go belly up, they (ie directors who are subscribing to the convertible bond issue) will be first in line to receive the proceeds from the receivers, ie bond holders get paid first, shareholders get paid last (if there is anything left). Meanwhile, the bondholders will get paid circa 7% per year on their original investment, which will cost the company (shareholders) around £0.2M per year. Should interest rates go up, it could be considerably more than this. This money will be paid out of future profits (if there are any)

Why not ask yourself this question: if the directors are so convinced that this is a good deal for ordinary shareholders, then shouldn't they be piling in buying up the ORDs at 4p a go, maybe they will, but I very much doubt it.

Gyllenhammer holds all the cards and he knows it, he is the ultimate winner in this deal. Basically he has gained control of the company and has managed to do it at a 50 - 60% discount, under normal circumstances it is customary to pay a premium for a controlling stake as I'm sure you are aware.

Anyway, good luck with your investment in CAB, I sincerely hope it works out for you and all other shareholders (including my missis), but it seems to me that Gyllenhammer has very cleverly extracted most of the value already and their seems to be very little left for shareholders

[justjim37] 19/3/2002 17:56

Do you mean there is more to "come" in your wet knickers gracey?
I'm told that every morning when you wake up you take off your
knickers and throw them at the wall.
If they don't stick to the wall you put them back on.
:0)

[dontknowitall] 19/3/2002 11:30

Well that made one of the mms change their price.

:)

Back in again for another profit!

[nav_mike] 19/3/2002 09:23

Just noticed the 660k trade at mid price. My guess would be a small institutional buy - cant believe they would offer a bid over screen price and not move it afterwards.

[hondas] 19/3/2002 09:14

nav was that a buy?

[nav_mike] 19/3/2002 09:11

I thought I was talking to myself back there..... LOL!

I am happy enough with the outcome but then as I have always said, I am longer term buyer of shares. Six to twelve months minimum.

Still think we will get a smallish run up ahead of results, and at the first sign of this co. returning to profitability it could get quite interesting.

My twelve month target is 7.5-9.0

[holdcroft] 19/3/2002 09:07

NAV_Mike, timbo003,

Yes, I agree.

The company now has a secure future and the directors are showing confidence by putting in their own money. Good for long term holders, but not so good for short term speculators.

[timbo003] 19/3/2002 09:05

Hondas

But what they didn't say in the RNS in January was that the convertible loans would be convertible at 2.125p, and they didn't say at the time that all of the £3M loan (now grown to £3.2M) would be as convertible loan stock

3.5p would seem like a fairer price for conversion of the loan stock to me.

Still, I don't think shareholders have that much choice, Gyllenhammer has them by the goolies, accept the deal or receivership here we come.

[hondas] 19/3/2002 08:52

this news is old news anyhow. this was talked about at their last statement

[holdcroft] 19/3/2002 08:42

It's a bit like a 2 for 1 rights issue at 2.125p. Great for those that are included, but not so great for us shareholders that are excluded.

[hondas] 19/3/2002 08:37

But the next move should be up nevertheless!

Also results are due soon and if they can turn a profit! well double figures will seem a distant worry washed away!

imo