"On February 5, 2009, Penn West closed the issuance of 17,731,000 trust units on a bought-deal basis with a syndicate of underwriters
at $14.10 per trust unit."
Who would pay that when the current price is below $10?
<<<Ya, I would have hedged 100% boe at $140, but stupid PWE management didn't. So dissappointed. >>>
I call "BS".
Look back 6 months to one year on this same message board.
Shareholders were screaming for management's head for "stupidly" [insert favorite expletive] hedging production.
The conference calls were an embarrassment as well.
If you were so cocksure of yourself you should have sold USO short for size.
I am not sure it has destroyed long term value, but I don't believe it helps the shareholder. Again, I would have handled the raising of funds (if needed) differently. I am disappointed in management.
The greater question is why management would want to dilute shares at this price level knowing that they need to pay the distribution on those shares.
Its kind of like taking a loan at a 23% interest rate.
I am long PWE.
"Its kind of like taking a loan at a 23% interest rate."
I don't agree. The distribution comes from cashflow, and their cashflow increased significantly from Q3 to Q4. So they can handle the distribution at the .23 level without having to borrow anything - that is why they cut the distribution in the first place.
Think "long" dude. Indeed that was more pps than today, but if PWE is fianancially sound and the overall market turmoil stabilizes...that just might be a great investment. Based on what i could see on the financial relaease...it appears that these guys are not idiots and have some business savvy at play. It is possible that the current pps might not be reflective of the actual value of this company. These are turbulent times. The selloff of yesterday was ridiculous.