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Magellan Petroleum Corporation Message Board

  • virtua98 virtua98 Jan 17, 2013 10:50 AM Flag

    Net Effect

    What is the Immediate Net effect of the Annual Meeting results and the Sopak Agreement ?
    Positives: 1) Shares outstanding reduced (53.9 to 44.6 million--17%)
    2) Warrants reduced by 4.35 million
    3) Likely removes threat of delisting
    Negatives: 1) Cost $10 million Cash
    2) Increased Options allowed by 5 million
    3) Increased need for cash and/or Partners to develop reserves.
    For $10 million (18.6 cents/share) we increased Present Value of PROVED Reserves by 50 cents/share! (Reference page 79 of Annual Report for Present Value of $130 million)
    AND, the value /share of all Potential Reserves increase by 17 % !
    Prior to the Agreement and the Annual meeting the Potential future Dilution was 7 million outstanding options plus 4.35 million warrants = 11.35 million shares. Now this becomes 7 million plus 5 million =12 million. So the possible negative effect is 0.65 million shares or 1 %

    The bottom lines are: Proved Reserves increased by 31 cents/share, Potential Reserves increased by 17%/share, increased need for cash or partners, and Dilution increased by 1%.

    Sentiment: Strong Buy

0.70-0.05(-6.42%)Oct 9 3:59 PMEDT