It is possible they would want to issue some subordinated debt (or equity) to pay down some of the bank line. That way they could restart the distributions. Could be expensive or dilutive, so I am a little leery of it.
They bought back KWK stock in the $20s 1 year ago, so issuing stock now would be hard to stomach. To be fair, commodity prices were much higher then.
I should have said they bought back Provident's stock, not KWK's.
It might make sense to have some subordinated debt in the capital structure. That ahould make them less subject to the banks whims. I am not sure what it would cost, so hard to evaluate. Plus, not sure what kind of covenants would be included.
Was reading the EVEP board and they were discussing that a capital injection would be better for the PPS that a distribution cut. They have to finance their recent acquisition and the stock fell but not like BBEP or EROC after the cut.
Baupost filled a 13D after the cut, so they are talking with management. It could be a possibility that they are planning a capital injection to reduce some debt and reestablish the distribution.
"am I being diluted?" I guess that all depends on how much they sell them for, what they do with the process (aquisition at a great price) and/or what the market thinks the value of raising additional capital right now is. However,in absolute terms, we are being diluted since there will be more shares in the market.