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Vintage Petroleum, Inc. (VPI) Message Board

  • imadeadcat imadeadcat Apr 1, 2003 4:47 PM Flag

    when I analyze VPI...

    It seems extremely attractive based upon proven reserves to enterprize value...even after factoring out Bolivia and discounting Argentina. I know they overpaid for Genesis and the PV 10 calculations have to be discounted for Argentina problems( which seem to be abating), tax etc. but overall looks like VPI is sitting on a gold mine. Someone care to sober me up?

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    • like they say...managements job is to take care of management, no matter of dumb investments in foreign properties, ect...just make sure the pecking orders are in place, along with the ass kissing priorities. just like the pinheads that work in government..their job is to take care of government. it is too late to sell, so hold

      'hacker

    • I received my annual report this weekend and poured through it. On the last page in the notes to consolidated financial statements is note 14 - subsequent event (unaudited). The note describes the terms of an exchange in which employees (mostly officers) exchanged 2.2 mil options with exercise prices from 19.28 to 21.81 per share for restricted stock (562m shares) at approx price of 9.50 (based on stcok price at date of grant-2/20/03). I find it mind-numbing that this entrenched management had the audacity to consummate such a transaction in the post-Enron world we now live and invest in. It is time for shareholders to express their displeasure, starting with large institutional shareholders. This type of self-serving corporate behavior cannot be tolerated anymore. Certainly there is no justification based on corporate performance over the past couplt of years. These guys make Boone look like a Saint. Boone, where are you when we need you?

    • IMO VPI management are one of the worst in the business world today.

      They have been unable to run VPI and generate decent profits for shareholders. Yet at the same time they are filling their pockets with money as shown by the stock for options grab.

      The problems are company specific and can be seen in the relative performance of other companies doing business in Argentina. That excuse by management is just that: an excuse that doesn't hold up.

      YPF is up 52% YTD and APAGF is up 36%. VPI is down almost 10%.

      To add insult to injury the stock is down some $5 since the T. Boone Pickens fiasco.

      Your price for an LBO seems quite reasonable given that the options the greedy management exchanged had exercise prices of over $19 per share...

    • I doubt we'd see a LBO with management owning 23% of the shares. Possible but unlikely as VPI mangement could pick the suitor they desire( clearly not T. Boone). But a take under with a well heeled private equity firm aligned with management at a price in the high teens might be doable. The problem with that is it would draw other bidders and management might get flushed out. I think management likes the hand they are holding, sees a good future, hangs on, and delivers for the shareholders. I don't think of management of VPI as sinister anymore than I viewed any of our last few political leaders in that light.

    • Don't worry Current Management will piss that advantage away somehow.

    • The other oil companies shares that do business in Argentina have been on a roll over the past three months with YPF up some 40% and Apco Argentina (APAGF) up 20%.

      During that time VPI has FALLEN about 5% so the relative performance is quite large.

      IMO the reasons are company specific with VPI falling because of a rotten management that can only seem to line their pockets at the expence of the ordinary shareholder as shown by the responce to T Boone and the most recent grab for more money by the board:

      The recent exchange of way out of the money options for some $5 million in VPI shares.
      Corporate greed at its worst.

      For chart see:
      http://finance.yahoo.com/q?s=VPI&d=c&k=c1&c=ypf,apagf&a=v&p=s&t=3m&l=on&z=l&q=l

      • 2 Replies to laketrack
      • in other words, what you mean to say, is that, the peterfaces in management are going to take care of themselves first...I understand how management feels...poor bastards...I weep...

        'hacker

      • I agree with you on out of the money options.
        I disagree on T. Boone as I view him dimly. Were I running VPI, I would have taken steps to thwart Pickens. Management and stock performance has been weak for last three years, partly their own doing and partly Argentina...but that's what makes it so compelling now,IMO. I keep coming back to the reserve metric...$7per barrel of proven equivalent for North America= (191times 7)$1.34 billion. $3 per barrel of proven equivalent in Argentina= (210 times 3) $630 million, add in the scraps in Bolivia and Yemen and the gathering systen in USA for another $100 million...total =$2.07 billion take away $760 million in debt and you have $1.310 billion for the equity divided by 63 million shares= $20.80 @. All rough numbers but compelling for the patient long term investor.

    • i live and work in the oil business in argentina, and believe oil companies after devaluation and despite export duties imposed, are making more dollar per barrels at equal oil price than before.

      and vpi is an excellent example.

 

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