Global Energy Development Share Discussion Threads

[squintyflinty] 17/6/2011 10:19

This could be another RPT scenario.The offer price was made at 24p and was said to be final......but it wasn't. They had to up their offer for shareholders to agree and part with their shares. DON'T accept this offer.If they want the company let them pay us a fair price.

[bwanad] 17/6/2011 00:20

Form 8-K for HKN, INC.


--------------------------------------------------------------------------------

16-Jun-2011

Other Events



Item 8.01. Other Events.
As disclosed in our prior SEC reports, HKN, Inc. (the "Company") owns approximately 33% of the outstanding shares of Global Energy Development, plc ("Global"), and Lyford Investment Enterprises, Ltd. and its affiliates, (collectively the "Lyford Group"), the Company's largest stockholder, separately beneficially own approximately 15% of Global's outstanding shares. The shares of Global are listed on the London Stock Exchange--AIM. The Lyford Group has agreed to acquire various assets from the United States Marshals Service, including an additional approximately 10% of Global's outstanding shares.

Pursuant to the City Code on Takeovers and Mergers (the "Code"), the Lyford Group and the Company are deemed to be "acting in concert" due to, among other factors, the Lyford Group's significant beneficial ownership of the Company's common stock. As a result of the additional acquisition by the Lyford Group, Lyford and/or one of the parties with whom it is deemed to be acting in concert are required under Rule 9 of the Code to make a mandatory cash offer (the "Offer") to acquire the outstanding shares not owned by the Lyford Group and its concert parties. Strictly for purposes of complying with the Code, the Company has elected to make the Offer at a price of 72 pence per share and announced the Offer on June 16, 2011 pursuant to the Code and the rules of the AIM exchange. The Offer is estimated to expire during July 2011.

The Company would not have elected to make the Offer without the Rule 9 requirement. Global's Independent Directors and financial advisor have both recommended that Global Shareholders do not accept the Offer. The Offer represents a discount of approximately 7.7% to the closing price of the Global shares on June 15, 2011, the trading day immediately preceding the date of the public announcement of the Offer. Accordingly, the Company does not anticipate that a significant number of Global shares will be tendered pursuant to the Offer.

The Company's board of directors appointed a special committee of independent directors to evaluate the merits and risks of making the Offer. The special committee unanimously determined that making the Offer was in the best interests of the Company.

Although not expected by the Company, full acceptance of the Offer would result in the payment by the Company of approximately $18.3 million in cash. HKN does not intend to make any changes to composition or location of Global's management, Board of Directors, or offices, nor does it intend to redeploy any of Global's fixed assets. The aggregate cash consideration payable by the Company will be financed from its existing cash resources.

[biggest bill] 16/6/2011 16:40

Stangely enough, the cash offer may actually be good for the share price in the long term. Any weak holders who want to get out can take the offer and the selling pressure on the shares will diminish.

[poacher45] 16/6/2011 16:18

The truth of the matter was that GWBush was supposed to be a oil billionaire. First of all he went to the arab states and could not find oil there and after totally failing to find oil anywhere in the world he became president. Says it all really doesn't it.

[hashertu] 16/6/2011 16:17

Ivan,
I incline to your interpretation of events.
72p is determined by the highest buy price (your post 1266). They are legally obliged to offer the same, or higher.
I wonder what possessed USMS to sell out at this time and at such a low price.
As the concert party effectively controlled the company before this offer, I suspect (and hope) that there will be no change to the direction of the company.
It was too good an offer to miss, especially if you knew the work over flow rates on T2 and T3 at the time the deal was struck (I assume at least 2 weeks ago).

[biggest bill] 16/6/2011 14:55

I've had a look at HKN's website. HKN is a small investment holdings company which specialises in small oil companies. It is only capitalised at $34m which is less than ged.

As far as I can tell, its holding in ged is purely for investment purposes; it doesn't appear to have any interest in taking over ged.

[biggest bill] 16/6/2011 14:01

It hasn't been made clear that this is a forced bid; this happens when people who have been deemed part of a concert party exceed 50% of a company's shares. It does not mean that they want to take over the company.

All this means is that they are legally forced to make a bid and the minimum bid that can be made is 72p because this is the highest price that they paid during the previous year.

[poacher45] 16/6/2011 13:40

Ivan Burgess

If you are right why has Global Energy not bothered to explain it properly to the shareholders or is it the usual lack of information? Why do they bother employing a financial PR advisors. Buchanon can now be added to the list of failures.

[jack parlabane] 16/6/2011 12:51

72p might well be an average over the past 6 months????

[ivanburgess] 16/6/2011 12:43

I think maybe they had to bid a price in relation to the market prices at a certain time. Not absolutely sure on the finer details though.

.
.
.
.
edit: herein may lie the answer -

""Accordingly, following consultation with the Panel, HKN is announcing the terms of a mandatory cash offer to be made to the shareholders of Global at a price of 72p per share, being the highest price paid for a Global Share in the last 12 months by any member of the Concert Party.""


""The Offer Price represents a discount of approximately 7.7 per cent. to the Closing Price of 78p of a Global Share on 15 June 2011, the trading day immediately preceding the date of this announcement.""


Maybe if they were to bid an excessively low price, the company could get accused of deliberately driving down the price (or prospects) of the company to then acquire the shares below the accepted market price by 'fraudulent' means ?

May be wrong, but it may offer an explanation.

[don carter] 16/6/2011 12:42

On further thoughts, if you're right then this is even more of a screaming buy than it was before the mandatory bid!

[don carter] 16/6/2011 12:40

Ivan, thanks for that explanation, which I think I understand. But why 72p and not something really silly like 1p? Why isn't there a code bid for these sorts of mandatories?

[ivanburgess] 16/6/2011 12:33

They don't want to take the company out. They simply wanted to increase their stake. But they have to make the offer under the regs, so they make a silly bid, at a price below what the share price is worth, so nobody in their right mind will want to take it up. (but if they did want to sell at 72p, then I'm sure they will hoover them up)

This will also mean that in the future, if they want to up their stake even further, they do not have to make another mandatory offer, leaving them free to raise their stake as high as they wish, without having to risk stumping up mega millions if the price eventually goes to a couple of quid a share.

Nothing to get worked up about. In fact, to the contrary, if you were party to all the knowlege they have, and you wanted to raise your stake so much, then it can only mean one thing .... that they know the potential is enormous, and they want as big a slice of the pie that they can get.

So fill yer boots.

[hugepants] 16/6/2011 11:55

I think they need 90% of the shares to make the offer unconditional. Anyone agree?



3. Views of the Independent Directors of Global

While the Independent Directors recognise that the making of the Offer is a requirement of Rule 9 of the Code, the Independent Directors consider that the Offer materially undervalues Global. The Independent Directors, who have been so advised by Matrix, do not therefore consider the terms of the Offer to be fair and reasonable. In providing advice to the Independent Directors, Matrix has taken into account the commercial assessments of the Independent Directors.


Accordingly, the Independent Directors intend to unanimously recommend that Global Shareholders do not accept the Offer. The Independent Directors do not intend to accept the Offer in respect of their own shareholdings amounting, in aggregate, to 221,985 Global Shares (representing 0.62 per cent. of Global's issued share capital).

[biggest bill] 16/6/2011 10:32

This is a mandatory offer at the legal minimum price that can be offered. They cannot expect to get many shares at this price.

[wooster4] 16/6/2011 10:29

could this be another rpt - cash offer originally made at 24 odd pence. Didn't get enough acceptances so upped offer again. Last time i looked, price was 50 odd pence.

[lw425] 16/6/2011 10:27

done deal imo

only way shareholders with large holding can realize their investment. if I held several hundred k shares i'd be inclined to take the cash and move on. plenty of other opps out there

nils my lad. what are your thoughts?

[sportbilly1976] 16/6/2011 10:01

the Directors are requesting that shareholders do not accept the offer...

I guess it would be nice if they now bought sufficient shares to block any attempt by Lyford to get this offer through...

given the recent share price action here, it does appear to be a very cheeky offer & fundamentally way undervaluing GED.

(I am not a holder)

[sporazene2] 16/6/2011 09:45

do they need 75% acceptance to move ahead?

[glasswala] 15/6/2011 11:28

I don't see much mileage in the political risk scenario bandied about by others on this board. Glencore would not be making a £475M investment in CST in Peru if there was a chance they would lose their investment due to nationalisation. This is just smoke to gain cheap shares by the MMs. We are only a tiddly little company in the big scheme of things so don't be fooled into selling cheaply. This will come good when the Markets realise they can't keep the share down any longer and will have to let it rise due to investor demand and commonsense.
Glass

[dugganjoe] 15/6/2011 10:29

Could get to 110p before retrace