Petrofac Share Discussion Threads

[armbar] 12/4/2024 07:37

Reason for that update is ?contained nothing we did not already knowThis will end up in Middle East hands somehow , convinced , all options remain under consideration Rough day ahead but feel like someone wanted to suppress the last three days momentum for a reason Now why would you issue a rns which surpresses the share price with little information , talks continue , someone will have this cheap cheap and it will be the ME.

[brut winky] 12/4/2024 07:34

Sounds like a D2E deal is close, first time they've mentioned that option.

[ghhghh] 12/4/2024 07:31

Further to its recent announcements, Petrofac today provides an update on the status of ongoing negotiations as part of its review of strategic and financial options.

The Company has engaged and remains in discussions with its lenders to restructure its debt which would result in a significant proportion of the debt being exchanged for equity in the business.


But what %? I'd guess 50%.

And what D4E price? I'd guess low. There is nothing positive in this RNS!


It also continues to be in discussion with prospective investors and certain major shareholders in relation to potential further investment in the Company and remains in negotiations with prospective purchasers regarding the sale of non-core assets, as set out in recent announcements. All options remain under consideration.


Still in negations. No reference to 'advanced' negotiations.

And what does this mean?

All options remain under consideration



Management and the Board are focussed on managing the Group’s payment obligations and delivering a solution which supports the provision of guarantees required for its recent contract awards, and which ensures that Petrofac has the appropriate capital structure and liquidity to support the strength of its US$8 billion backlog.


So are they hoping to resolve guarantees re recent awards pre restructuring and the rest post restructuring?


While the Company continues to face challenges in securing new performance guarantees, it is progressing discussions with credit providers and clients to find solutions with respect to the guarantees required for its recent contract awards.


What's covered by 'recent?


The discussions with lenders and other stakeholders continue at pace and further announcements will be made as appropriate.

[dealy] 12/4/2024 07:24

Well, I don't know what to make of that update. Clearly, there is no trading in the bonds if such discussions are taking place. If anything, the bond holders will want the bond price to stay depressed because that strengthens their hand in any D4E deal.On the other hand, other options remain open. Nothing is clear

[babbler] 12/4/2024 07:16

22p? Where did you get that figure from?

[whites123] 12/4/2024 07:09

Portion of debt at 22p D4E ??????
Maybe it was a leak then....



Petrofac Limited ( PFC)
Petrofac Limited: Update on strategic and financial options

12-Apr-2024 / 07:00 GMT/BST



12 April 2024



UPDATE ON REVIEW OF STRATEGIC AND FINANCIAL OPTIONS

Further to its recent announcements, Petrofac today provides an update on the status of ongoing negotiations as part of its review of strategic and financial options.



The Company has engaged and remains in discussions with its lenders to restructure its debt which would result in a significant proportion of the debt being exchanged for equity in the business. It also continues to be in discussion with prospective investors and certain major shareholders in relation to potential further investment in the Company and remains in negotiations with prospective purchasers regarding the sale of non-core assets, as set out in recent announcements. All options remain under consideration.



Management and the Board are focussed on managing the Group’s payment obligations and delivering a solution which supports the provision of guarantees required for its recent contract awards, and which ensures that Petrofac has the appropriate capital structure and liquidity to support the strength of its US$8 billion backlog.



While the Company continues to face challenges in securing new performance guarantees, it is progressing discussions with credit providers and clients to find solutions with respect to the guarantees required for its recent contract awards.



The discussions with lenders and other stakeholders continue at pace and further announcements will be made as appropriate.



ENDS



For further information contact:

Petrofac:
James Boothroyd, Head of Investor Relations
[e-mail]

Sophie Reid, Group Head of Communications
[e-mail]

[bigbigdave] 12/4/2024 07:05

12 April 2024



UPDATE ON REVIEW OF STRATEGIC AND FINANCIAL OPTIONS

Further to its recent announcements, Petrofac today provides an update on the status of ongoing negotiations as part of its review of strategic and financial options.



The Company has engaged and remains in discussions with its lenders to restructure its debt which would result in a significant proportion of the debt being exchanged for equity in the business. It also continues to be in discussion with prospective investors and certain major shareholders in relation to potential further investment in the Company and remains in negotiations with prospective purchasers regarding the sale of non-core assets, as set out in recent announcements. All options remain under consideration.



Management and the Board are focussed on managing the Group’s payment obligations and delivering a solution which supports the provision of guarantees required for its recent contract awards, and which ensures that Petrofac has the appropriate capital structure and liquidity to support the strength of its US$8 billion backlog.



While the Company continues to face challenges in securing new performance guarantees, it is progressing discussions with credit providers and clients to find solutions with respect to the guarantees required for its recent contract awards.



The discussions with lenders and other stakeholders continue at pace and further announcements will be made as appropriate.

[mirabeau] 11/4/2024 22:27

Wshak

Fascinating insight into how the behaviour of a company's bond is a far more accurate indicator of a company's financial health and its future than its equity

thanks

[wshak] 11/4/2024 21:45

I owned Enquest and Tullow bonds at their lows, added more and still own them both now.Tullow bonds are my largest position in any single name, ever, as a result, currently 97c.I don't know what will happen here, but can say I'm not attracted to either bonds or equity.The situation with Petrofac is nothing like either of the names mentioned.If equity holders are holding out for a miracle, then I'd look to Sirious Minerals for inspiration, where Anglo came in and bought them out of nowhere.Shareholders didn't get zeroed, although they were still mostly unhappy. The bonds went from 35 to130 as a duff credit went from junk to blue chip!The PFC bonds have hit new lows tonight at 38c, so something has to give here.

[leoneobull] 11/4/2024 21:25

Enq and tlw had low bond prices massively below par. Neither required a d4e. I know they are producers not service firms, but still.

[kulvinder] 11/4/2024 21:15

Wshak, sorry to hear you also lost money on Afren ...but I do think PFC will come good, as if it was that dire, we would already know about it and they would not be winning new business if things were as bad as the shorts appear to suggest.

[armbar] 11/4/2024 21:02

Three strong days Leta see what tomorrow brings All to play for Would not hold out for any over 10% rise PFC comment to the market, did not do it on the way down so unlikely on the way up, unless media speculation, we await till imo one all inclusive update GL

[tahmina1] 11/4/2024 20:58

Wshak but at least in the Western world you dont anticipate criminal fraud on the part of directors.

[wshak] 11/4/2024 20:40

Kulvinder,If it's any consolation, I made a huge loss on Afren bonds, despite concurrently making a large profit on a short trade on the shares.The shares obviously went to zero as the balance sheet suggested that they would. However, the company also needed extra funds to survive that no-one (including bondholders) was willing to provide.As a result, bondholders walked away from the table, and bonds fell from about 40p to zero too. Their rationale was that they weren't willing to throw good money after bad, given things were so dire.I lost far more on the bonds than I made on my short.

[ghhghh] 11/4/2024 20:27

Should the share price closing up over 13% elicit some sort of a response from the Company tomorrow? Bit of a false market if in the final throes of a 4p D4E!

Was - agree re accrued interest and must be dissuading a few investors from buying.

[wellbutpoor] 11/4/2024 18:56

Interesting action today.

Personally, I strongly suspect this to be a futures based pump and dump, as the share price is highly vulnerable to manipulation at present.

The fact that the bonds remained lacklustre today would lend weight to this theory.

For the record, I decided to switched my funds into TLW mid week and so missed out on todays gains.

Could tomorrow see the eagerly awaited RNS?

[geckotheglorious] 11/4/2024 18:33

leoneobull
I hope you bought a return from DC, so you can afford to gey back I'm case of a short spike!

Erm, he probably manages it 'online' so....

[leoneobull] 11/4/2024 17:50

Jaknife. I hope you bought a return from DC, so you can afford to gey back I'm case of a short spike!

[seagreen] 11/4/2024 17:35

Now if you're feeling miserable, if you're feeling blue,
Here's a little ditty that'll help to pull you through,
All the clouds will disappear, the grey skies turn to blue：
Just stick your finger in your ear and go ting-a-ling-a-loo.

[wshak] 11/4/2024 17:24

Hi Paul,

I've been looking at this from the perspective of a potential purchaser of PFC 9.75% bonds - currently trading at sub 40c on the dollar. YTM is currently 59%!

I suspect that the recent increase in the share price is more to do with a surge in borrow costs for those short - some of them may have decided to close at borrow costs of 80%+.

Normally, that kind of borrow cost is associated with the final thrashings of a dying fish, as borrow dries up.

Coming back to the PFC bond, I see there is a coupon payment due 15 May 2024 which will cost the company $29.25m.

They may well pay that to give themselves time but I'd bet that there must be discussions going on at board level to discuss whether it's prudent to do so. My bet is that the upcoming results will explain why they won't be paying it as restructuring looms.

Furthermore, there is $252m in debt due for repayment in October 2024,unless something has changed from the last annual report. it may be that the $162m RCF portion of that isn't fully drawn down and both of these loans are amortising down if they are being serviced properly.

Looking at what happened at Metro Bank doesn't really help the situation, in my view. Shareholders were largely wiped out there with a highly dilutive placing at 30p with equity being worth sub £50m from memory? Subordinated bondholders had to take a bath as a condition of new money coming in from an existing shareholder but other shareholders only got marginally above nothing in reality.

it'll be fascinating to see how this plays out, but it looks more like Afren to me than anything more positive.

I haven't bought the bonds yet - they may be a decent punt, although there must be a big risk the next coupon doesn't get paid.

[hades1] 11/4/2024 16:53

This industry is very leaky for obvious reasons!
Always was - Too many people involved.

[harry_david] 11/4/2024 16:42

Today's move looks like insider trading, well I hope so!!