Rurelec Share Discussion Threads

[smicker] 17/6/2014 08:21

80,000 at 6p equals 4800 pounds.

[giant steps] 16/6/2014 15:00

Small intervention by directors @ 6p - price supportive ?

RNS 16th June 2014

[giant steps] 12/6/2014 22:49

A research note by Edison, a precursor event ?

[swooped] 12/6/2014 16:16

Looks like a research note has been produced by Edison, fantastic reading and gives all you need to know

[swooped] 12/6/2014 16:15

Looks like a research note has been produced by Edison, fantastic reading and gives all you need to know

[dr fillip strange] 12/6/2014 14:26

"Bolivian compensation clears path to growth"
new Edison report out..

[swooped] 09/6/2014 09:45

Who's confidence, yours? I'm staying put, seems crazy to bail out now just when all this arbitration nonsense is now behind us and it's time to get on with the business at hand. My view is all the bad news is out there only better news now to look forward to, at these prices people should be buying not selling, although I see it time and again, people buy on the way up and then end up selling at the bottom, not exactly what I would call wise investing, but then to be honest, in hindsight, neither was not selling at the top BEFORE the arbitration decision!

[loverat] 09/6/2014 08:52

Confidence draining away now.

[swooped] 07/6/2014 10:41

No financially they have done very well out of this but, once the word gets around, how many other companies will approach them for help knowing the ramification when a little leeway is required. Long term they have done themselves no favors, particularly in gloating the fact.

[outsizeclothes.com] 07/6/2014 01:02

I wouldn't count Burford as a loser - quite the opposite, and I'll bet their shareholders are a lot happier with the way their management acted than ours are with the way our management did.

[loverat] 06/6/2014 20:59

A good summary above.

A very sad story of how greed, cash grabbing and carpet bagging can cause long term consequences. All losers at the end of the day.

[swooped] 06/6/2014 20:48

Well I guess at the time they took out the loan it all seemed like a good deal, particularly as the Burford RNS stated at the time that Rurelec could not get any better terms.

I think it was not the terms of the deal that caused the problem, I think that stemmed from what happened when Rurelec needed the few weeks extension.

My guess is that what Peter is commenting on is the fact that Burford knew Rurelec were up against a wall so took advantage of the fact to shaft them, additionally, I think Bolivia knew that Burford would play hardball so basically forced Rurelec to take a low offer on faster payment with the knowledge that Rurelec had no choice, otherwise Burford could have squeezed Rurelec on a default of a loan.

Either way Rurelec were caught in the middle with nowhere to turn, if Burford had not been so, as Peter states, avaricious, then perhaps Rurelec could have fought Bolivia from a position of strength, knowing that Evo would not have wanted to 'officially' go into default on the award after June 2nd.

With a word like avaricious used, my guess is that Burford turned the thumbscrews and charged Rurelec royally for the extension, but still not enough in terms of time to force Bolivia into a default. It's all obviously speculation on my part but the facts seems to add up. It's all very sad really as no one comes out well from this; Bolivia will undoubtedly be a pariah state to invest now for many, I doubt if anyone will be quick to turn to Burford for capital and Rurelec have a much reduced award on an already much reduced award. All pretty appalling and just shows the greedy and worst side of capitalism.

[code677] 06/6/2014 19:21

Sounds like an attempt to appease investors and contradicts other comments on the lender

Rurelec's Chairman Colin Emson commented on the transaction: "The innovative finance from Burford lowered our cost of capital and helped our business to expand. Burford's team was smart, fast and decisive. Rurelec's ability to monetize a pending claim could only have been achieved with Burford."

[mbaxter] 06/6/2014 19:13

"avaricious and mean spirited lender" = more petulant posturing. No one forced the company to take out a loan under the terms they signed. The senior management is directly responsible for the decisions they make - good or bad. They need to just accept and admit that they made a series of mistake(s) with this rather complicated side venture and move on.

[swooped] 06/6/2014 17:06

Not so sure about that loobrush, we have it stated that, "Rurelec is finalising the selection of a joint venture partner for the project. The selection of a partner and the closing of bank financing is expected to be achieved in the latter half of 2014."

"Receipts from the sale of this equity will both recycle funds of over US$30 million to Rurelec for us to reinvest in other projects as well as enable us to engage with regional partners with whom to share the challenges of building greenfield plants.

We are already in June i.e. later half of 2014 is almost upon us.

[loobrush] 06/6/2014 16:54

Results are terrible-but expected-altogether a share to avoid for a while as I think that although assets may be stated as there a lot of these are in unfinished and untried projects and looking at individual projects it's going to take a long long time before the company returns to profit.

[code677] 06/6/2014 16:46

'disastrous' sums it up

+$24.9m net arbitration award after legal costs
-$25.9m paid out to Burford Capital
=-$1.0m cash outflow to Rurelec

[swooped] 06/6/2014 16:29

Pretty horrible set of results but then they were never going to be when we had a balance sheet carry expectation of $75 million and we got less than half of that.

What is good to see though is a re-statement of our current NAV at 10.46p lower than I expected, however we still need to increase another 44% on today's price just to trade at NAV so still very much undervalued even with the disappointing results, thanks to Bolivia and as we now know, Burford Capital.

"avaricious and mean spirited lender" are indeed extremely strong words, lessons learned indeed, I will be surprised if Burford get anymore takers for arbitration funding after that revelation!

[mirako] 06/6/2014 16:17

Not a very cheery set of results. The current share price - a discount to book - looks about right until Rurelec can demonstrate higher operating profitability, dividends and a rising net asset value.

[abcd1234] 06/6/2014 15:59

"the subsequent pressure placed on us by an avaricious and mean spirited lender whose lack of support forced us to agree with the Government of Bolivia large discount against the already unsatisfactory PCA Award. "
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~




pity they released this so late today, as I would have enjoyed seeing the FT's/others comment on that expression of frustration

[tony1974] 06/6/2014 15:57

"avaricious and mean spirited lender"

Strong words!!