Global Petroleum Share Discussion Threads

[hugepants] 18/10/2015 19:37

olieslim is right. Issuing directors shares at 2p in lieu of salary when cash per share is approx 4p makes no sense. That's effectively giving them a pay rise not a pay cut! The only way it makes sense is if the company is preparing to announce a deal that rerates the share price.

[emptyend] 17/10/2015 13:54

...aaaahhh... But they have said that they are now more confident that a value-enhancing deal can be done. And if they don't do one soonish, then giving up 25% of cash in exchange for shares will prove fruitless.If they can't do a deal in the current market that is worth MORE than the cash pile, I'll be very surprised. The sooner the discount is closed, the better.....

[chinahere] 17/10/2015 12:13

I agree with you about the 'dim view' if this continues without a deal soon!

[olieslim] 17/10/2015 11:29

The dim view:

The lower the sp, the more shares to replace the cut cash compensation.
-It'll hamper newsflow
-It'll disencourage director buys

It looks like a spread out ongoing placing in slow motion. To save the company cash the directors take shares and the shareholders only dilution. The longer and more undervalued the share is, the more shares for the directors and the more the dilution for the shareholders. Great incentive to do something about the sp?

'Coïncidentally' they actually more than double their 'cut' pay with this period's share price solely compared to the company's cash:

Relevant period Share price averaging period
------------------------------ ------------------------------
1 August 2015 to 31 October 1 August 2015 to 31 October
2015 2015

Maybe the scheme is acceptable if that meant all outstanding and future options were cancelled too?

And as there still is no proof of anybody doing anything (except spending money on people thinking out 'cash saving' schemes), the company could do with saving on an entire director salary, or two, three... permanently?

[emptyend] 16/10/2015 08:51

.....so....cash compensation cut by 25% from start of August and replaced by shares. Should help preserve the cash pile, though there will be a need to get a deal done and crystallise the value gap represented by the discount to cash. Sadly I'm not planning on visiting Brisbane in November - but it would be interesting to hear views of anyone who is able to attend the AGM.

[emptyend] 16/9/2015 08:08

Tower have announced their Cameroon PSC signing today. Namibia is next on their agenda. Still expect a link of some sort with GBP.......

[emptyend] 15/9/2015 10:57

I don't think that is quite right. They've certainly looked at a vast number of possible deals - but they've also been very picky.Now they have signalled ( both directly and indirectly) that they expect to get a value-enhancing deal done, I expect them to deliver one. If they get to year-end without one, then I'd not only be very surprised, I'd also want a good explanation!Its still early days in the "deal season", so I'd be expecting to see something in the next 4-8 weeks.

[p1nkfish] 14/9/2015 12:34

if there is one.
the management appear jinxed given so many near misses on good stuff that could have happended but didn't.

[emptyend] 14/9/2015 10:40

Dunno. Wait until you see the deal.

[emptyend] 11/9/2015 15:01

Well there may or may not be. My expectation is that they will do a deal that offers BETTER returns that a wind-up for cash. Certainly they are unlikely to get a better chance of doing such a deal than the present environment offers, with low oil pricces and a dearth of investment capital around.Time will tell - but if they can't get a deal done in the next few months then they should wind up, IMO. But I think the reason they have now cut costs is to preserve the cash pile for a worthwhile deal that has already been identified............you'll recall that Tower recently said they expected to enter Namibia? All connected, IMO.

[chinahere] 11/9/2015 14:43

Mostly agree emptyend but even if they wound it up after taking shares as pay there would still be more profit that way.

Having said that I am hopeful that a deal is on the cards too.

[emptyend] 11/9/2015 13:15

Yes chinahere....makes sense......BUT ONLY IF they do a deal that moves the share price to at least the value of the cash. What would make no sense whatsoever to the most self-serving of directors would be to fail to so such a deal and let the share price continue to drift lower in relation to cash.I'm not expecting them to suddenly leap into action for the greater good - I'm expecting action because they own over 40% of the company and they will want to realise some value from that.And it must be noted that sitting on and slowly depleting cash has in fact been one of the less bad things to do in recent years, so I don't think that, post the oil price fall, the board can be criticised too much for not doing a deal earlier.That is why I recently quintupled my stake to hold more shares than I have ever had in this company. Granted my previous stake was worth a lot more at 20p+....but I sold the vast majority at those levels....for once.....and I'm happy to buy back those and more after the 92% fall.

[joestalin] 10/9/2015 14:01

the BOD do the honourable thing? - you were not thinking of holding your breath, were you?

[chinahere] 10/9/2015 12:21

If the share price is below cash then paying yourself in shares makes sense. £1 -> £2.

I just hope there is a deal soon or failing that the BOD do the honourable thing and wind it up.

[emptyend] 10/9/2015 10:26

...but that is the point. The directors are, I suspect, now largely being paid in shares:
the Board is implementing a substantial reduction in corporate costs, including a significant reduction in the cash element of the compensation of the Board and management. (24/7 RNS)

There will be a reason for that, IMO.....

[joestalin] 10/9/2015 09:01

Not while they are being pillaged by the directors.

[chinahere] 09/9/2015 19:11

I've got some of these but will they ever do anything?!

[emptyend] 23/8/2015 23:11

....OK - thought that was it originally and then recalculated wrongly. Still a "bit of a gap" to be closed though.... ;-)

[ohisay] 22/8/2015 05:20

Yep - US dollars not OZ dollars.

[hugepants] 18/8/2015 10:01

EE, I think cash per share at end of June is 4p (not 3p). ie. $12.7M = £8.2M = 4.1p per share.


GED is also valued about 50% of cash.

[emptyend] 18/8/2015 08:00

So...very small trade today in Aus.....into the bid. Closing price in Australia equivalent to 1.8-2.7p.....versus our 1.5-2.0p.If/when anything happens with GBP it'll be interesting to see how anything gets done.....

[emptyend] 17/8/2015 09:58

Another day with no trading in Australia. I guess the quoted spread of 3.8-6.6 Aussie cents isn't encouraging anyone, despite the last trade at 7.2.

I'm a little more surprised that people here aren't doing the math with a 1.5-2.0 pence quoted spread.......
......given that cash on the balance sheet at the end of the last quarter amounts to 6.3 Aussie cents - which is 2.97 pence - and they have now said that they are "more optimistic of concluding a value-creating transaction".

Against that backdrop, you'd think the offered side discount to cash would be starting to close (as it seems to have already done in Australia, despite virtually no trading).