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| Share Name | Share Symbol | Market | Stock Type |
|---|---|---|---|
| Columbus Energy Resources Plc | CERP | London | Ordinary Share |
| Price Change | Price Change % | Share Price | Last Trade
|
|
|---|---|---|---|---|
| 0.00 | 0.00% | 1.825 | 01:00:00 |
| Open Price | Low Price | High Price | Close Price | Previous Close |
|---|---|---|---|---|
| 1.825 | 1.825 |
| Top Posts |
|---|
Posted at 05/8/2020 16:30 by eggchaser A rather good post on Lse board I thought!!CERPâs merger market cap value in June 2020 was £25.1m including a premium uplift. In October 2019 when the share price was 5.1p its market cap was c£50m. in 2019/2020 analysts predicted a potential share price of 21p (and market cap of c£200m) assuming various factors proved favourable. LGO-fanâs informative posts on this BB 29/7/20 describes what these could be in the short/medium term. When the markets closed Friday, CERPâs market cap was £17m.Thought experiment logic-flow (all figures approximate, sources already stated in my previous posts since June 12):1. Post-merger this week, there will be c3.4b shares in play. Imagine BPC has no assets, there are no Bahamas licenses and no spud, however there are still 3.4b shares vs 1b CERP ones today. This would mean the market cap, purely based on CERP would be in the same potential range as shown in the above introduction: £17m - £25.1m â" £50m â" £200m.2. With 3.4b issued shares this would value the possible share price in the above 4 benchmark figures at approx 0.5p, 0.75p, 1.5p, or 6p WITHOUT any BPC assets, potential assets, and BPCâs DEBT FREE $11m it has in the bank today.3. When the markets closed Friday, BPCâs share price was 2.45p and had a market cap of £61m (without CERP). In February 2020 it has a share price high of 5.7p and a market cap of £121m (without CERP). Leading to spud, analysts predicted a potential share price of 8p and market cap of [£170m] (without CERP).When we officially merge this week, letâs assume the combined share price is as now 2.45p and a combined market cap of 83m (3.4b shares). This means CERPâs value which accounts for approx 25% of future news-flow and revenue generating assets is approx. 25% of 2.45p. When split, this is a measly 0.6p and BPCâs an even more measly 1.85p. For goodness sake, despite CLNs and a rights issue creating some dilution, BPC share price was often at 2p for years without a glimmer of news! [And without the $11m we currently have in the bank!!]Bottom line: I donât think the markets, retail investors and rather unusually even day traders have realised that the share price today is way, way, way below the short and medium term potential of the merged organization. And that doesnât even take into account the benefits the merger WILL bring such as leveraging finance to drill Persv-1 and potentially increasing production/revenue from CERP assets. All IMHO. DYOR.Starchild |
Posted at 02/7/2020 17:47 by 12bn Subject to the assumptions set out in the Announcement, Columbus shareholders and related parties will in aggregate hold approximately 23.9 per cent. of the enlarged issued share capital of BPC.////////// So 76.1% of all earnings will go to BPC share holders and only 23.9% to Cerp current share holders. So if Saffron B is drilled the driller will take their cut and then the remainder will be shared between BPC and CERP shareholders, who will be shareholders of a single combined entity. If after the driller takes their pound of flesh there is say $10 a barrel left for Cerp, under the merger deal Cerp shareholders will get $2.39c. If the SWP is drilled the same thing happens,after drilling costs the profits will be shared $7.61 to BPC holders and $2.39 to Cerp holders instead of $10 to Cerp. What do current shareholders in Cerp get for these generous gifts? A right to share in the costs and profits of the Bahamas drill,which I don't think will happen and nothing much else. BHP has $9m cash but Cerp don't get the benefits of this. Even if it ends up getting invested in the SWP of Trinidad BPC shareholders gain 76.1% of any benefits,whereas if Cerp didn't do the merger but raised cash elsewhere, they could keep 100% of profits not 23.9%!!!! Do I think that this merger will work out well for Cerp holders,NO, but they are between a rock and a hard place as imo CERP are pretty much skint. |
Posted at 30/6/2020 07:56 by arrynillson BigSi2 - I knew 12bn would be impressed with your arguments - he thrives on unsubstantiated poorly researched tosh but surprisingly the point about LIND selling is fair comment - CERP have stated that it's their policy to pay in shares for the time being, whilst cash is being conserved. Whether Schroders will continue selling now that an alternative exit strategy is available, at a higher price, remains to be seen ( even 12bn concedes that crashing the share price to sell wasn't in their interests!).If CERP had no potential I could see the danger of regular selling by LIND but 12bn doesn't seem able to understand CERP potential- ( for example, only recently, he was in denial for weeks over the Saffron drill findings and lost out on a 100% share price profit opportunity!). Regular followers of CERP understand the potential from Saffron, PRD/ Trinity Inniss, Goudron new deal/ EOR, Suriname Et Al! 12bn CERP aren't bringing significant cash to the deal, having regard to debt, but they are bringing lots of potential which can be developed with BPC cash if PV1 is delayed - would using that to drill SWP be such a terrible thing 12bn? |
Posted at 29/6/2020 08:31 by tomford8 jcgswims here is the lse post by Starchild you are referring toBPC/CERP Access to ‘capital markets’ after merger: A key question 28 Jun 2020 06:06 Please refer to the recent Rule 2.7 Announcement RNS Page 13 quote is with my emphasis in CAPS: ‘…&hell My observations 1. ‘Equity capital’ means share diluting CLNs or rights issues. ‘Debt market’ is a different way of stating ‘capital market’. It means BONDS. Bonds are not usually share diluting. See hxxps://www.investop 2. CERP is too small to access the bond market. BPC is too risky. Combined BPC/CERP can and will, otherwise the CERP BoD would not have unanimously agreed to a merger that would require a massive CLN. It’s similar to a couple wishing to get a mortgage. Separately they do not earn enough (or have enough security) to get the loan, but jointly they can. 3. Corporate bonds can be structured in various ways, such as capital and interest paid on maturity. Bondholders are the highest ranking creditors above shareholders. They will lend to a BPC/CERP entity with the knowledge their investment is secure based on CERP assets alone, even if Perev-1 is not as successful as the studies predict. Key question: So why haven’t the BoDs spelt it out? [My answers: (a) perhaps they will with the merger voting documents, or (b) It’s so obvious they can issue bonds, they don’t have to spell it out. A bit like a couple can clearly get a 200k mortgage on a combined income of 100k and additional security, or (c) a JV with Stena or another 3rd party is on the cards which would make most of the above somewhat irrelevant, or (d) a bit of (c) and a Bond issue. My assumptions: I’m leaning towards answer ‘d’. This will explain the reluctance of senior BPC and CERP folks while recently being interviewed, to have given more information citing confidentiality. If purely a bond issue was on the cards, they would have all answered with a polite version of, ‘listen mate, are you a dimwit? How did you get your job as an interviewer? Don’t you know how the bond market works? If not, have a word with GNEISS or any merchant bank that issues bonds.’ Now, if a JV is on the cards, the BoD cannot pre-announce it unless the deal is TOTALLY signed off, otherwise if the BoD uses it as a key justification for the merger, the JV target could change the draft terms in their favour knowing the BoD would have to accept the new terms to avoid embarrassment. I think news will arrive very soon. Perhaps even with the voting documents. Starchild |
Posted at 19/6/2020 12:37 by pr100 The CEO interview added nothing to the story so far, imho. TH should have been asked what he gets out a merger which costs him, and other directors, their job. Too wishy-washy just saying that the deal was agreed for the benefit of diverse stakeholders. And still no production update from CERP (last known: 550-650 bond in Oct 2019). If this key data is missing from the upcoming shareholder circular, I will definitely be voting against since I object to being treated like a mushroom.Nor was there any mention of the main reason for CERP's depressed share price which is the relentless and ongoing forced selling by our major shareholder. Damaging as this has been for the SP, it hasn't impaired the value of CERP's assets - hence basing a merger deal on current SPs is the worst possible idea for CERP shareholders. COVID at least impacts both parties to the deal but Schroder is exclusively CERP's temporary problem. BPC can't be blamed for wanting to take advantage of CERP's forced seller - but CERP should never have agreed to negotiations based on temporary and one-sided share price movement. It's also highly relevant, but unmentioned, what Schroder intend to do. I'm sure BPC PIs won't want to inherit their daily selling. Looking forward to the circular before the end of the month as it needs to contain all the missing information. I blindly followed LK once but won't be doing it again. Especially as our BoD only own 1.6% of the equity between them (albeit this is not as bad as BPC's BoD's 0.6% skin in the game). All these guys are tiny minority shareholders so they need to start delivering some persuasive facts PDQ. Good to see the share price up this morning but it can't be because of this interview. |
Posted at 15/6/2020 12:51 by pr100 That interview with an uncomfortable-lookinFirstly, no matter how excited LK may be about the prospects for the Perseverance well, it still has a <30% COS, ie it's a huge gamble. What I think he is saying, but can't actually say, is that CERP is down and out and that PIs should take advantage of any pre-TD rise in BPC shares to cash out. All talk of £500m valuations for the merged entity is nonsense since there will be one valuation if Perseverance is a gusher and a more likely valuation if it is a duster (or is never drilled). An inflated market cap may materialise temporarily during the P1 drill but that would not be a real or sustainable valuation. It also seems highly suspect that CERP's current or near-term production level isn't referred to anywhere by either CERP or BPC. How can anyone judge the merits of the proposed merger without knowing CERP's revenues? The conclusion must be that production has dropped to near zero with little near term prospect of lifting it to a respectable figure and every chance that CERP will go bust without imminent new financing. That much was always likely to be the case so why not spell it out? The CERP team could have raised cash but don't appear to have tried very hard. BPC may have a better chance of raising cash from flippers since their share price is likely to be more volatile over the next six months - but cornerstone investors will be hard for them to find too given the high risk of the well which will only be very slightly reduced by the acquisition of CERP's small-beer assets. There is no farm-in envisage for the P1 drill. BPC themselves have stated that any farm-in deal would only materialise after P1. So if desperate for cash, they could well sell off some or all of the CERP assets. They claim to be fully funded for P1 but approx $20m of that cash isn't yet signed and sealed, however much it may still be on the table and an honourable intention. At the very least, BPC needs to name these financiers to add some credibility. And there has been no mention anywhere of the possible $4m Predator asset purchase following the CO2 test. Why not? If this merger is Hobson's Choice, ie CERP will go bust without it, LK needs to say so. If not, nothing has been said to persuade me that buying into BPC's long term future is the right thing to do. Meanwhile, this LK interview hasn't impressed the market. CERP is down and BPC is down even more with (clients of) Shore Capital apparently dumping 1m shares. I need more clarity in order to vote in favour of this merger. |
Posted at 14/6/2020 13:02 by pr100 I doubt that CERP (or BPC) will get 75% shareholder support for a merger based on LK's gut instinct or any of the "justification" so far presented. The proposed merger has not yet been properly explained or justified, and that's a fact.And even the LK fan-boys among us willing to give him the benefit of the doubt and follow him anywhere can't justify it now because he won't be controlling or even managing the merged company. He will just be a non-exec picking up £2k a month for a day's oversight of the board workings. So we would be following him to a dead end. I don't know Simon Potter and he may be a good man; but he doesn't have the presence and charisma of LK so would be an acceptable substitute for me. I applaud Potter for apparently keeping shareholders on-side for almost 10 years of slow progress on a binary bet. And I appreciate the style, content and apparent transparency of his RNS's. But everything stops when LK walks into a room and, for me, Potter isn't in that league. I fear that at some point in the coming days/weeks, the truth will out and the parlous state of CERP's production, finances and prospects will have to be laid on the line in order to justify the sell-out and get the required vote in favour. But while CERP PIs might be convinced by the "warts 'n all" truth to vote for the deal, it will have the opposite effect on BPC shareholders. But I can't see any other justification for the merger. It looks bad, it's embarrassing for LK, most of the CERP management are dismissed or sidelined, it's too cheap and it runs contrary to what LK has been telling us. I fear that the truth today is far uglier than we have been led to believe. Otherwise, there's no doubt in my mind that LK could have raised whatever cash CERP might need going forward. Time will tell…but the truth has to come out before the vote. Simply trusting LK to do what's best for me is no longer an option. |
Posted at 13/6/2020 11:32 by eggchaser Hmmm..... taken from LSE - my take is we don't know why the merger yet - could be bad or it might be for good reason?For now I remain on the fence with my vote as both sides need to be listened to.lease copy and paste this post somewhere for posterity. I had an eureka moment yesterday evening which I slept on overnight before posting. It involved reviewing recent RNSs, analysing human reaction and joining the dots to paint a prediction picture based on possibilities vs probabilities.Q1: It is a safe assumption to assume the CERP BoD were neither desperate nor suffering from mental issues. So why did the CERP BoD unanimously vote to merge with BPC considering most of them will be out of a job? A1: It is because they know of material events behind the scenes which will substantially increase shareholder value and the share price in the merged entity.Q2: Why did the CERP BoD unanimously agree to a BPC share price valuation of 3.33p considering the share price has fluctuated so much since January 2020? A2: as above and also because there is a high probability more positive RNS news-flow is on its way BEFORE the merger vote on 24/7 and 27/7.Assumptions:1. When the proposed merger announcement was made Thursday it caused a mini panic and confusion until Friday lunchtime. If lynching was legal, some BPC + CERP shareholders may have exercised that option against key members of both BoDs. When the share price recovered Friday and these disgruntled shareholders began to understand the overall strategy as being very symbiotic, many calmed down.2. I believe positive RNS news-flow will emerge between now and the July vote to ensure 75% acceptance. And if this news-flow results in a BPC share-price of higher than 3.33p, it will give even more reason for CERP shareholders to accept.3. The above will also entice BPC shareholders to accept, as the share price from now until vote assumes the merger will be agreed. Contrarywise, if the share price is [much] higher by end of July, and the vote is rejected by BPC, it is likely to fall.So what's going on behind the scenes? The answer is to look at dates and to paint a picture of probabilities.1. Stena were given 'various' options (RNS 26/5) for funding including a farm-in in lieu of services. And others that have not been disclosed. At the time based on the $10m for 10%, it valued the company at 3.2p DISCOUNTED. This was despite the share price on 26/5 closing at 1.58p.2. At any-time from 1 September, Stena can join the party. And I suspect they already knew about the merger plans, Uruguay and other stuff not yet in the public domain.3. Why 1 September? Because as long as the merger happens in August, I believe Stena have already agreed in principle to do a farm-in JV for a number of wells not just Pers-1. The Stena sphere group are cash rich. While their drilling ships are under-utilized due to Covid-19, they have nothing to lose and everything to gain if only 1 spud is hot.4. As part of point 3, there is even the possibility Stena will JV with BPC to go on a M+ A shopping spree of companies similar to CERP affected by Covid-19 and PoO.I'm voting YES (BPC) even if some of the above doesn't happen. |
Posted at 13/6/2020 09:50 by pr100 There is very little difference between a merger and a takeover. Usually, the only difference is that a merger is mutually planned and agreed whereas a takeover is an aggressive, often unexpected, move by one of the companies involved.It's an unequal merger and it looks like a takeover because hardly any CERP personnel are involved in the new company. If approved by shareholders, the enlarged entity will presumably be given a new name since "Bahamas" PC will no longer be an accurate description. Other corporate changes may be announced at the same time - possibly including a leading executive role for LK. I assume that the mooted $4m from Predator is no longer on the table or LK would surely have carried on. If it does now materialise, BPC will have paid much less than the headline price for CERP and will doubtless channel the cash into Perseverance. Both sets of shareholders need to see how the CERP valuation was arrived at before they can vote at their respective GMs. And CERP shareholders need to understand why this cheap deal was being worked on back in April and why the CERP BoD are recommending it. On the surface, it looks like an admission that CERP's claimed future prospects and "transformational" recent discovery were not true and that the broker was complicit in misleading shareholders. There's no secret Perseverance farm-in. BPC shareholders would rightly be furious if their directors had given away a quarter of the company with such price-sensitive news kept secret. The stock market regulators wouldn't like it either. LK now in a lose-lose situation as he cannot sensibly explain this sell-out without antagonising at least one set of shareholders and incriminating himself. The video may never appear if it has been conveniently pulled by the nomad. He will have to answer a lot of tough questions at the GM - but most PIs will already have cast their vote by then. If there is no public Q&A session before then, he is running scared. On no account should any PI vote for or against this merger without seeing clear answers to all the obvious questions. At this stage, he has lost trust. |
Posted at 12/6/2020 15:28 by jcgswims Malcy's blogBahamas Petroleum/Columbus Energy Resources- A full cycle Caribbean Champion… This was a deal that few would have thought of up until recently, BPC paying for each CERP share 0.803 in new BPC shares valuing CERP at 2.67p or £25.1m flies in the face of all those positive missives via RNS or video. BPC shareholders will own some 76% of the ‘merged’ business with CERP owning 24%, a thought that Columbus supporters would have only envisaged in their deepest, darkest nightmares. For BPC the rationale is indisputable, they have been for many years a one geography, one structure, one well player and until the recent acquisition of a licence in Uruguay might have seen it all come and go with the spinning of just one drillbit. They must have thought that all their Christmases had come together when it dawned upon them that they could take CERP for a handful of new shares and add a number of strings to their bow. From being a one trick pony BPC now has production and exploration, it has upscale-able low cost producing fields in Trinidad with what only this week was described as a discovery at Saffron that might transform its owners especially as it was potentially so large that the drilling company involved paid to carry CERP for the second well. In addition it has added a potentially very exciting onshore licence in Suriname another asset that Columbus chased for a long time. Having said all that it does seem that despite huge cost-cutting and potential upside within the portfolio CERP has been really struggling to grow, most fund-raising avenues appeared closed to them and markets appeared closed. It would be interesting to see if this was the first approach that they had received, either way it looks like an interesting move by BPC and its team who have woken up this morning with a full cycle, debt free, significantly potentially accretive portfolio with production and exploration upside. In this context it is worth noting that the team over at Gneiss Energy have been incredibly busy this week, not just advising Bahamas here but also earlier in the week where they advised on the Humber/Union Jack deal at Wressle, do they never sleep over there? The confirmation that this is a takeover not a merger is best proved when looking at the management of the new company ‘Following implementation of the Merger, the existing Board and management team of BPC will remain unchanged’. Apart from Leo Koot the Columbus Chairman who becomes a Non-Exec director of BPC and the country MD, not a board position, everyone else goes, even the highly regarded CFO Gordon Stein doesnt make the cut. The BPC management do have a great deal of experience in similar territories with a lot of producing experience from Arrow and Dart and elsewhere so they feel they have the opportunity to increase production and eliminate overheads. With the substantial driving force of Eytan Uliel, Chief Commercial Officer and very tough negotiator to back up Simon Potter there is little doubt that BPC now have management in abundance. So, for Columbus the bottom line is that they genuinely believe that this is a good deal for their shareholders for a number of reasons. The recent COVID-19 virus together with the oil price fall has made life very tough for companies especially if raising money in these markets is difficult, in those circumstances there are few ways of driving their exciting projects forward, this deal is best for shareholders and you can only ask this from management, the call on whether this is right is up to the investors. You really have to go with the board on this but with no IR advice and no specialist investment bank on board they went with their and their broker’s instincts, they might well be right…. For BPC the rationale is straightforward, they could no longer be a one trick pony with little ability to raise money and everything reliant on one well. This ‘moves them up the street’ and certainly will open a few more doors when the broker fixes the next roadshow, also whilst the farm-out continues, with the well paid for and de-risked company wise any entrant is now likely to come in at the appraisal stage, if there is one. Recently I wrote that with Trinidad firing on a lot of cylinders it would be possible to see a bit more M&A in the region, I must admit I wasn’t thinking of this particular deal but looking at it how it hangs it seems like it is very much one to watch, Eytan Uliel is very much a man on a mission… |
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