Faroe Petroleum Share Discussion Threads

[sludgesurfer] 20/12/2018 12:44

It's funny reading DNO talk down the assets they are so keen to get their hands on.

[fntc] 20/12/2018 12:44

Dno just disclosed a buy of 4.8 million shares. They have 29.9% total now. Not sure if they can cross 30% without having to bid with no conditions? If so, and DNO have stopped buying, it explains why the price is dropping below 152.

[binarypilot] 20/12/2018 12:07

Its like listening to a husband and wife in a bitter divorce battle.

Hee Hee.

[fntc] 20/12/2018 12:01

"Faroe has claimed that DNO's Offer substantially undervalues the company based on the average price paid recently for comparable North Sea portfolios, citing as supportive evidence a report prepared by consultants Wood Mackenzie. DNO notes that the Faroe directors commissioned this report, that the report is far from exhaustive and that it merely provides the consultants' subjective analysis of price data from selective transactions."

and

"DNO notes that today Faroe has released another consultant report, again which the Faroe directors commissioned, this time commenting on the company's exploration performance. By contrast, no Competent Person's Report has been published by the company in response to DNO's Offer. Such a report would shed objective light on the company's valuation for the benefit of all shareholders, including DNO. Needless to say, DNO strongly encourages Faroe to do so, as is regularly done by listed exploration and production companies as a matter of best practice, transparency and governance."

[fntc] 20/12/2018 12:00

FPM presentation out:

DNO response:

[sludgesurfer] 20/12/2018 11:51

As a holder, my heart agrees with Malcy. As a realist, I think he lives in some 2012 fantasy land where small cap E&P is still seen as some "hot sector" where the market awaits every find with baited breath. We're in a different world.
The last few years have been tough. Shale has completely altered the landscape.

I know - I've worked in the industry for 17 odd years, much of which with one of the larger mid-cap US producers. They've been falling over themselves to offload deepwater conventional oil assets at knock-down prices which only a couple of years prior were considered the jewel in their crown.

Clearly there's still profit to be made from conventional but the industry has changed - its all about "lean methodology", "kaizen" and squeaking the maximum possible profit from what you have....Toyota terms which would have been laughed at in the industry 5 years ago.

I hope this bid doesn't go through and hope to hold to see the Faroe story play out. But with Brent at $55, WTI at $46, a horrible macro environment and a less than bullish supply/demand picture for next year, I think enough institutions just might capitulate for an all cash exit.

[ed 123] 20/12/2018 11:44

Yes, it's looking like DNO will win at 152p. Six million shares (approaching 2% of the issued equity) changed hands at around 152p by 11:30am and the buy side of the order book has slipped (only slightly but significantly).

Every takeover I've experienced undervalues the target. No complaints from me if it does go for 152p. Otoh, if it survives this attempt, then that's ok too. Faroe then goes on to grow further. Content either way.

As ever it's in the hands of the big holders.

[fntc] 20/12/2018 10:51

The main reason people are holding is they hope for a higher bid, most likely.

[thedudie] 20/12/2018 10:21

The share price will fall until investors buy - for me I am in for the long term. (I first bought at 74p and then more below that because my timing is never right!) There are not many opportunities to buy a company with a forward plan like this one.
td

[binarypilot] 20/12/2018 10:12

If it does not go through, the share price will surely plummet?

If it does go through, then you will get less than market price is now.


So why hold onto your shares now?


Genuine question for discussion.

[bountyhunter] 20/12/2018 09:59

Neither will I.

[harry rags] 20/12/2018 09:49

FWIWI will be doing nothingHarry

[jasper2712] 20/12/2018 09:07

These 2 points are the reasons I will be rejecting this offer

"Discount of c.45% to the average price paid recently for comparable North Sea (in particular, Norwegian Continental Shelf ("NCS")) portfolios measured on a per barrel of 2P reserves basis(3)"

"-- DNO's opportunistic Offer seeks to exploit the recent oil price fall - timing its Offer announcement after the oil price fell to a 12 month low - to acquire Faroe on the cheap "

[bountyhunter] 20/12/2018 07:47

From this morning's RNS..


As previously stated, the Board strongly believes that DNO's criticisms of Faroe are wholly unfounded and simply a tactic to distract from the simple fact that its Offer substantially undervalues the Company

To reject DNO's opportunistic, unsolicited and inadequate Offer do nothing

John Bentley, Non-Executive Chairman of Faroe, commented:

"It is your Board's strong belief that this Offer is entirely opportunistic and that the terms fundamentally undervalue Faroe.

We have one of the best exploration track records on the Norwegian Continental Shelf and are currently in the midst of the largest drilling campaign in Faroe's history. We are fully funded to deliver our 35,000 boepd production target in the near-to-medium term and are confident in our ability to deliver in excess of 50,000 boepd in the medium term."

[hashertu] 19/12/2018 18:34

ENOC had a 52% stake in Dragon Oil from 2012 through to 2015, and Dragon was listed all that time.
As mentioned above, anyone holding greater than 1% has to disclose all buys/sells on a daily basis. That includes DNO.
Of the (approx) 22million share sales reported by RNS, only 1 million went below 152p (Hargreave Hale today).
In crude terms, those reporting have gone from 50% to 44% of shares in issue.

[thedudie] 19/12/2018 15:01

Well 2 million sale by Nat Farmers Union went somewhere at 152.1 and presumably can't be to DNO as >1.52.

Not sure about earlier 1.05million at just below 1.52 -- that clearly may have gone to DNO.

td

[bountyhunter] 19/12/2018 13:56

DNO would also have to disclose every percentage point crossed above 28% if they are mopping up shares as has been suggested. So they don't seem to be mopping up any significant number at all.

[jasper2712] 19/12/2018 13:44

DNO will not walk away from a goose that will be laying golden eggs.

[fntc] 19/12/2018 12:13

If anyone was accumulating above 1% they would have to disclose it daily, during the offer period, so looks like retail investors to me.

[thedudie] 19/12/2018 12:00

Think someone else must be accumulating at a much faster rate than that!

[thedudie] 19/12/2018 11:59

So DNO picked up approx. 24000 yesterday then .....

td

[ed 123] 19/12/2018 10:46

Yes, tempting. I didn't pick up any shares in the 70p private placing but did manage to buy a good number in the market later at about the 70p level. Subsequently, the shares fell back to around 45p with the oil price; ouch! Bought some more. Fast forward to recent events, anticipating a bid, I bought more at around 139p, only to see them dip to 125p; ouch again! Then the bid announcement arrived and, of course, I was relieved. Have sold some at about 152p, approximately equivalent to the number bought at 139p. That's me reducing risk. Guess those shares have gone to DNO?

Holding the rest, for now. But, who knows, that may change?

Everyone will have their own individual circumstances and will make their own decision. No advice from me. Good luck to all.