Serica Energy Share Discussion Threads

[nigelpm] 05/3/2024 12:37

Most of our cash has now been transferred to Mercuria

Explain this - it makes no sense.

[ashkv] 05/3/2024 11:40

More likely forced out rather than "resign"!!!!

[sageofonion] 05/3/2024 07:03

None of those companies were in the cash-rich position of SQZ. Most of our cash has now been transferred to Mercuria for the sake of a few execs keeping their jobs. Ironically they have now resigned.

[nigelpm] 04/3/2024 23:16

How have the other NS producers faired? i.e. Enquest, Harbour and Kistos.

[sageofonion] 04/3/2024 22:27

The value destruction here is horrendous.
In hindsight, it looks like Mr Raper was right.
Seems like a fiduciary failing.
hxxps://youtu.be/A8eG7Pw3X_4?si=c0_ln3Ar4jWl54Rj

[cowie19] 04/3/2024 18:31

That is quite the letter, no ambiguity there. Look at the share price today. Tells its own story.

[ashkv] 04/3/2024 18:18

At the time of the deal - Tailwind 2p figures were the end End 2021 figures Circa 39-40mn barrels!!!

The total consideration for the Proposed Combination of 703 GBPmm represents a multiple of ~$20/barrel of 2P reserves, with 52% of the purchase price being settled with Serica shares. But our Serica shares trade – referencing the acquisition mark of 278p – at an implied EV/2P reserves of ~$6/barrel, a 70% discount to the price being paid!

[nigelpm] 04/3/2024 17:24

And what has any of that got to do with a counter to Al's $20 for Tailwind? - that I note he or anyone else hasn't been able to counter-counter.

[ashkv] 04/3/2024 16:25

NigelPM change from USD to GBP for Tailwind is a sleight...

Firstly GBP has appreciated against USD - making a USD purchase less onerous if backdating figures.



Secondly Decommissioning costs are not included in NigelPM calcs

Thirdly Dividend paid to Tailwind in H1 2023 should also be included in the deal cost as Tailwind holders in effect received funds that accrued from pre-deal SQZ gas assets!!!

An onerous deal... just google the facts and figures from Jeremy Raper letters / analysis!!!

It is all there,...

[stemis] 03/3/2024 10:22

I didn't say in any of my posts in this discussion whether this was a good or bad acquisition. That's a matter for opinion. But let's at least use the right numbers. No way did SQZ pay £20/boe or anything like that for Tailwind, as I've clearly demonstrated.

[nigelpm] 02/3/2024 22:13

No one said it was a great acquisition. We just questioned your numbers and rightly so.

[oilinvestoral] 02/3/2024 21:19

The PM is absolutely riled up with rage! Unlucky for him I can't read his posts.I give up! The bean counters are right! Tailwind is the best North Sea acquisition in living memory, great assets negotiated at a perfect price! Fleggy deserves to be knighted for his efforts! We should've paid the private equity mob more money as £644 wasn't enough! Now does everyone see why he called himself PM: Pugnacious Mendacious? Very fitting name! Good night all

[oilinvestoral] 02/3/2024 21:17

On a more positive note, at least the accountant now knows the difference between the 2007 film thriller and the definition of 2P reserves as defined by the Society of Petroleum Engineers. Anyway speaking of films, there's a film I'm going to watch with the family!

[stemis] 02/3/2024 20:06

If you want to be prudent you could calculate a scenario of valuing the 111 million shares issued at 315p (which was the daily moving average price leading up to the acquisition). I bet you won’t because that though because it doesn’t suit the agenda !

I used 218p and 278p because the former was used in the interim statement and the latter in the original announcement of the acquisition. I could have used all sorts of other share prices. The current one of 178p for example, which is the value the vendors would actually have received if they sold now. But I didn't.

[stemis] 02/3/2024 20:01

Serica will also be taking on Tailwind's net debt, which as at 30 November 2022 was c.GBP277 million”

However the acquisition took place on 23 March 2023 when net debt had reduced to £247.235m

You can make all the adjustments you want

I'm not making any adjustments. I'm using actual published figures.

Don’t want to get into a long winded argument Stemis!

Neither do I. You are entitled to your opinion. What you aren't entitled to without rebuttal is to misrepresent what I used as the basis of mine.

[nigelpm] 02/3/2024 20:01

It wouldn't be prudent. It would just be plain wrong.

[oilinvestoral] 02/3/2024 19:54

Also to be clear Stemis ! The only reason our share price was decimated to £2.18 was because of the disastrous acquisition. There's no way they would've been that low without the dilution and the debt taken on! If you want to be prudent you could calculate a scenario of valuing the 111 million shares issued at 315p (which was the daily moving average price leading up to the acquisition). I bet you won't because that though because it doesn't suit the agenda ! Have a nice evening Stemis

[nigelpm] 02/3/2024 19:40

Which is why, all throughout my post I gave two possibilities. One using 218p (which is the share price used in the interim statements) and 278p (which was the share price in the original announcement i.e.

Therefore net cost/mmboe is (551m/55.5 or 618m/55.5) £9.9 or £11.1 depending on which share price you use.

Having thought about this more - I think it makes more sense to go with the price on acquisition date.

Can I also add I think this has been a very useful discussion - I hope others are finding it useful also.

[nigelpm] 02/3/2024 19:35

You have to base it on the day of the acquisition Al.

Any good accountant would tell you that ;-)

You don't acquire a business on the day of the first RNS that sets out the planned terms.

[oilinvestoral] 02/3/2024 19:35

I see the diminutive pugnacious little Moaner is foaming at the mouth with his responses. I can't read them ! Please combust quietly there's a good bean counter!

[oilinvestoral] 02/3/2024 19:33

Don't want to get into a long winded argument Stemis! With all due respect here are the numbers from the RNS: "On the basis of the Serica closing price as of 19 December 2022 of 278 pence per share this would be equivalent to GBP367 million. Serica will also be taking on Tailwind's net debt, which as at 30 November 2022 was c.GBP277 million"£664 million was what was announced! You can make all the adjustments you want bottom line is that the company overpaid and we are all suffering as a result!

[nigelpm] 02/3/2024 19:28

I'd add crazy labour government decisions aside this looks very good value here. Similar to prices around a £1 post bkr.

[nigelpm] 02/3/2024 19:26

You are one of the most patient posters on advfn stemis. You have my utmost respect.