Ophir Energy Share Discussion Threads

[rogen83] 21/2/2019 07:01

One of Ophir Energy Plc’s earliest investors and an influential London banker, Ian Hannam, is adding to pressure the exploration company is facing over a takeover plan.
Hannam wrote to the company’s Interim Chief Executive Officer Alan Booth and the board saying they agreed to sell Ophir to Jakarta-based Medco Energi Internasional Tbk for too low a price, and they should reconsider recommending the deal.

“Ophir shareholders also believe in a higher value and would welcome the opportunity to roll over their investment with a credible and experienced board and management team,” Hannam wrote in a letter, dated Feb. 18, seen by Bloomberg.

The letter comes as an activist shareholder, Petrus Advisers Ltd., and others, have criticized Ophir’s decision to accept a 55 pence a share offer from Medco. The takeover will be put to a vote at a date that hasn’t yet been set, and must be passed by a majority of 75 percent of investors for the deal to go through.

Ophir declined to comment.

The entrance of Hannam into the fray may bolster efforts from those seeking to squeeze more out of a sale. A well-known London banker, once called “The King of Mining,” Hannam said in the letter he had advised Ophir from its inception until 2015 and considers its CEO “a personal friend and I respect him.”

Hannam argued that Ophir hasn’t done enough to engage with governments and owners, pointing to problems in Equatorial Guinea. In the beginning of January, the government of West African nation decided not to extend the license that holds the company’s Fortuna gas discovery, ending plans for its flagship liquefied natural gas project.

Hannam said the views expressed to the board represent his personal opinions and that he hasn’t spoken to other shareholders. He suggested other exploration companies in London should be invited to bid for Ophir.

[vprt] 20/2/2019 18:39

Drilling has started offshore Mexico (Murphy, Cholula well in Block 5)

[arteespresso] 20/2/2019 17:37

Makes me think does goblin work for Petrus!!!!

[arteespresso] 20/2/2019 17:35

Interesting goings on today, especially given the price.

[ashkv] 20/2/2019 16:19

Sandgrove increased yet again to 17.40% on 19 Feb 2019. Wowzee and at close to 55p price. Something is definitely COOKING :)

[romeike] 20/2/2019 13:33

As I thought.

[ashkv] 20/2/2019 10:48

In light of the above, we demand Dr. Adel Chaouch and Dr. Carl Trowell – whom we both trust – be put in charge of the
following key tasks immediately:
? Managing the sale of the Mexican license portfolio for cash;
? Soliciting offers for the Tanzanian licenses;
? Soliciting offers for all or parts of the South East Asian operations and in particular Thailand;
? Reopening discussions with the EG government about appropriate compensation for their unprecedented and
unfair seizure of the Fortuna license – despite Ophir having invested c. $700 million and having discovered and
proven up valuable hydrocarbons for the country. We demand you present a legal strategy that includes suing
EG and anyone who wants to bid for the Fortuna license;
? Actively engaging with interested parties for all or parts of Ophir;
? Presenting an alternative to the Medco offer including a minimum of $100 million of tax-efficient distributions
to shareholders immediately; we believe proceeds for the Mexican license and / or Tanzania should be added to
the $100 million distribution number.
Under your watch, an enormous amount of value has been lost for investors. This is your final reminder to preserve and
build value. We reserve all our legal rights in this situation.

[ashkv] 20/2/2019 10:48

Dear Bill,
On 14 January 2019, we sent you a letter expressing our view that Medco’s offer of 55p / share significantly undervalues
Ophir. Since then, the market has traded millions of Ophir shares above 55p. At this point, Medco is paying less than the
fair value of Ophir’s South East Asian production assets1
meaning they are gifted substantial synergies and the upside
potential from Ophir’s licenses in Tanzania, Mexico and Equatorial Guinea (“EG”).
Since you joined the Ophir Board, the share price has fallen 87% representing $2.1 billion of value destruction2
. We
increasingly see a pattern suggesting a potential conflict of interest: The Board seems to prefer to sell Ophir at sub-optimal
terms rather than fight for shareholder value:
? Your Operations and Trading Update on 15 January 2019 was exceptionally conservative. In key parts,
management seemed to have revised essential factors, such as Ophir’s production outlook without logical
explanation;
? You added Dr Adel Chaouch to the Board without mentioning his background as a specialist in EG or the fact he
was proposed by Petrus Advisers and enjoys broad shareholder support;
? The situation in EG was mismanaged. You failed to meet with the key decision makers following the departure
of Dr Nick Cooper in April 2018, who had held these relationships;
? You seem to have prematurely agreed a termination of the Fortuna license;
? We see no significant progress in marketing assets including Ophir’s Mexican licenses and the 20% ownership in
Blocks 1 and 4 in Tanzania;
? You seem to not have professionally solicited and considered offers for Ophir from other buyers; and
? You repeatedly blocked shareholders’ demands for Ophir to return capital to shareholders which in the current
situation has to be the basis for any Plan B when the current Medco offer will fail.

[ashkv] 20/2/2019 10:46

Latest Letter From Petrus to Ophir Management / CHairman Bill Schrader

hxxps://petrusadvisers.com/media/letter_to_bill_schrader_19_february_2019_final.pdf

[prefab] 19/2/2019 16:35

If I knew I'd be filling my metaphorical boots - As it is I'm happy to just keep my current holding, I think that a few entities are just betting on an increased offer from Medco or another party entering the fray. Interesting that a GM still hasn't been called.

[scoble2] 19/2/2019 15:15

Lots of buy going on any reason?

[spacedust] 18/2/2019 22:56

Sand 17%
Hsbc 15%
Gold man sucks 7%
Now bank of America 7%

Is that almost 50% held by the above. Who is good is maths

[arteespresso] 16/2/2019 12:20

Insider trading, well who knows how much goes on. All we know are the ones that are caught and they are few and far between.

[prefab] 15/2/2019 23:35

The entirety of sandgroves 17.2% holding is via CFD and thus has no voting rights. It strikes me that this is a simply a bet on either an increased or new higher offer imo.

[spacedust] 15/2/2019 15:43

Great advice I wonder why the biggest gangsters in the planet, goldman, are buying at sell price.......think about it

[romeike] 15/2/2019 12:40

"things going on in the background now" is not a basis on which to risk buying at the offer price. This deal could very well fail and Medco will walk away rather than offer more, with OPHR falling back to low 40s in the short term. I set aside some cash to trade this scenario if it happens but the behaviour of the board, lack of CEO and other clues suggest this was all stitched up many months ago. I like to think the recent buyers are in touch with the activist and are getting involved because they think they can block the sale and get better value by appointing their own team. They certainly aren't getting involved for 5p and I just can't see the activist, who were previously pretty noisy, just sitting by and doing nothing while their investment gets trashed by an incompetent board.

I haven't read or heard anything to give credence to the idea that there is a white knight, I think that is indulgent wishful thinking in this market, but I suppose anything can happen. One thing that is certain is that the board who recommended this bid aren't deserving of investors trust.

Strategy: Buy into sharp drop as board recommended offer is voted down and parties aligned to Medco withdraw. Successfully replacing board with shareholder friendly strategy to divest exploration assets and return value while prepping the remainder of the operating company for onward sale at a good price when market confidence is bullish.

[spacedust] 15/2/2019 10:01

Now gold man sucks builds 7%

So
Sand 17%
Hsbc 15%
Gold man sucks 7%

Who is good at maths here.....is that 40% of the company in those hands....anyone have the list to aim rule 26

[nigelpm] 14/2/2019 23:22

Perhaps more likely that they know other parties are interested or that this is way undervalued.

My guess is they like the business fundamentals and expect to get another 5p out of Medco at the minimum.

I doubt they know other parties are interested because that would be insider trading and would stick out like a sore thumb given they've built a 17.3% stake!!

[arteespresso] 14/2/2019 22:36

Fair enough. Seems like the odds are heavily stacked against them, potentially little gain vs what could be a fall in price. Perhaps more likely that they know other parties are interested or that this is way undervalued. All conjecture of course, but I think there is a lot more to this than meets the eye.

[prefab] 14/2/2019 22:11

Well it's a £66m gamble thus far, quite some blind punt - They'll know exactly what they're doing.

Spacedust re: 6053, there'd be no point - they've made an offer, there's no need for cloak and dagger from them imo.

[nigelpm] 14/2/2019 22:02

Sand Grove are a hedge fund - they get involved in risky stuff - that doesn't mean they are always right.

[nigelpm] 14/2/2019 22:01

To intimate that this is a gamble on their part is just plain crazy - it’s perhaps the sort of thing a PI may do, and I’m sure many on here do.

I didn't intimate that at all.

Just making the point that Medco could walk away.

Deary me - this board really does exhibit some pain at times.

[arteespresso] 14/2/2019 21:37

Nigel, what makes you think Sandgrove will be betting someone else comes along? Are they stupid/naive enough to base this on a hunch/roll of dice/roulette? No of course not . They must have good reason to, we just don't know why YET. To intimate that this is a gamble on their part is just plain crazy - it's perhaps the sort of thing a PI may do, and I'm sure many on here do.

[rogen83] 14/2/2019 21:27

Oh dear - what a clown