Global Petroleum Share Discussion Threads

[hugepants] 26/10/2015 09:57

thats a big trade at way above the ask price.

[olieslim] 26/10/2015 09:54

Global Petroleum Limited GBP 2.90 +0.65 (28.89%) 575,465.00 2.25 2.9 2.055

[emptyend] 22/10/2015 10:07

....well that NEARLY answered my question...... about £7000 in at 2.24....

[emptyend] 20/10/2015 15:46

I wouldn't get over-excited. But it would be interesting to know at what price you could put £10k in.....

[chinahere] 20/10/2015 15:42

Yes, hardly any volume has changed the price.

Come on deal !!

[olieslim] 20/10/2015 15:38

13 postings and only 30k shares (£600andafewp) traded.

You're too greedy ;-)

Don't get left behind!

[emptyend] 20/10/2015 13:21

Both comments above seem to be ignoring the fact that the board own over 40% of the shares. In that context, the recent conversion of salaries into shares is trivial.The fact that they have even more incentive now to make a deal and reduce the cash burn should be seen as a clear positive, IMO.As to whether they have "wasted" time and cash by not doing a deal in recent years, you simply have to look at share prices in the sector. Doing a deal 2-3 years ago would have been a serious waste of cash and they would probably now be in very serious trouble......so whilst there has been a big discount to cash at least they can now do something - which is an option that many companies don't have.I'm firmly expecting a sharp narrowing of the discount to cash, but there will need to be a clear value-enhancing deal before it trades at a premium.

[p1nkfish] 20/10/2015 12:20

None outside of now being paid in shares.

The discount to cash is a measure of the value placed on the management by the market.

Premium to cash would be an indication the market thinks the management can allocate the resources wisely. There is a discount, tells you what you need to know as far as the market is concerned.

[joestalin] 20/10/2015 11:38

"the market thinks they are going to waste the cash" - that is because the market as watched them do precisely that for a number of years. Is there an incentive for them to do otherwise? That is the question.

[emptyend] 20/10/2015 10:31

...and, I should point out, the Board's share entitlement is based on an average price over the prior period....whereas ordinary investors can take the offer price today. I took the offer price a while back, at about 1.84 average. Today it appears to be 2.10.....but that is still a discount to both the cash and, indeed, the price at which trades took place in Australia earlier today....

[emptyend] 20/10/2015 10:27

I would very firmly argue that they are showing the market that the extent of the discount is unwarranted - and encouraging the market to close it. If shareholders and others decline to follow their lead in preferring shares to cash, then the board really can't be blamed. Shareholders have the same opportunity as the board - in fact they have more opportunity, given that they are unconstrained by close periods etc.There is of course no certainty that the shares will actually be issued - but I'd say it was highly likely, unless they go into a close period (as they are bound to).

[hugepants] 20/10/2015 10:01

There is no certainty the payment in shares part of their salaries will be made. Its up to the discretion of the company.

[chinahere] 20/10/2015 09:51

They have no direct influence on the share price, but they are taking advantage of the discrepancy aren't they!

[emptyend] 20/10/2015 09:32

I'm in no doubt that the discount exists primarily because the market thinks they are going to waste the cash. That will change when a different view emerges.Small correction re the dilutive effect - it is "up to" the equivalent of the salary sacrificed....and the extent of the dilution depends entirely of whether the market wants to buy the equity at a discount or not. If it doesn't ( and shareholders don't increase their own stakes etc) then I'm afraid its just a fact of life. Contrary to common perception, directors have next to no direct influence over share prices.

[chinahere] 20/10/2015 09:23

"2. The fact that there is c.4p of cash is well known and disclosed. The fact that the market apparently accords this a value of 2p at present is not the fault of the board."

The market probably doesn't like the prolonged absence of deals and the continued decline of company cash - hence the discount. The new share dilution which is currently absorbing shareholder's equity at twice the cash rate won't help either.

We all agree that a deal needs to come soon. Failing that they should honourably wind it up.

[emptyend] 20/10/2015 09:19

Worth noting that, unusually, there were a number of small trades overnight in Australia (frequently there are none at all)..... and all of those were at 5 cents, which was 30% above previous close. That 5 cents is equivalent to 2.35p.....

[emptyend] 20/10/2015 08:33

1. What August RNS?2. The fact that there is c.4p of cash is well known and disclosed. The fact that the market apparently accords this a value of 2p at present is not the fault of the board.3. Whilst the board are plainly (from July/Sept RNSs - and the fact that they are seeking to preserve cash via part-payment in shares) thinking that they can get a deal done, they have basically said as much to investors. However, "discussions" have been going on for years without a deal - the only difference is that they probably now have a clear plan. What they DON'T have at present is a signed deal.I'm encouraged that there now seems to be a plan (to get a deal done) - but they still have to execute it. As I've said above, WHEN the market thinks they can and will execute, the discount should narrow sharply. Until that point, shareholders have the same opportunity you criticise the board for - they can also buy 4p cash for 2p......and the sooner they do, the less marginal dilution there will be.

[chinahere] 20/10/2015 08:23

Perhaps they should be good to shareholders and at least buy them in the market?

Of course that would reduce cash quicker.

Oh, I just hope for that deal.......

[chinahere] 20/10/2015 08:19

Yes, I meant that they are worth 4p so it's a bargain for the BOD!

[olieslim] 19/10/2015 23:21

chinahere 19 Oct'15 - 08:31 - 5420 of 5422 0 0

I hope for a deal too, but paying yourself in 4p shares would also make sense if the company was being wound-up soon.

---------------------
For the record, they are paying themselves in shares @ sub 2p for the period while the company has 4p in cash.

Because the BoD has been withholding, I suppose pricesensitive, info (See August RNS) they will be paying themselves 'double' at the expense of dilution exclusively to shareholders.

P.S. Maybe that's normal in China there ;-?

[olieslim] 19/10/2015 22:56

HugePants,

Have a look at their options. Those are peaking this quarter. And that's no coincidence, imo.

If this ain't one of those infamous 'Australian scams', shareholders might finally get to have a peek in their agenda.

GL

[emptyend] 19/10/2015 09:34

That is also true. But if it is wound up and we get 3.5p back early next year then that is hardly a disaster for those of us who are long from sub-2p in recent months.It is, however, only 25% of normal salaries that are now being paid in shares - which seems an appropriate balance. Once it becomes clear that there really is a conclusion coming to this long wait, I'd expect the discount to cash to narrow quite rapidly, given the very restricted liquidity in the shares.

[chinahere] 19/10/2015 08:31

I hope for a deal too, but paying yourself in 4p shares would also make sense if the company was being wound-up soon.

[emptyend] 18/10/2015 20:08

The only way it makes sense is if the company is preparing to announce a deal that rerates the share price.

Precisely.

It plainly isn't yet "done" - but I suspect they have a short list of possible deals and a clear expectation of getting one of them over the line in the fairly near future.

The other aspect is that, by preserving a bit more cash, they are also preserving their attractiveness as a cash shell.

I'd like to see a sharp narrowing in the present discount to cash though........into the 3p area would be reasonable as "deal time" approaches.