BRY subject to gains for their investors as soon as deal closes -
It will be a very long time before LiNN will see any gains from this union. They plan many more areas to work on however if one realizes how long it takes then we will have to wait a long time before the real benefit of the two Companies uniting will be felt by LINN investors! Something to really consider!
BRY is the typical company - div paid out of after tax $. After the merger, BRY accretes into LINE which is an MLP. MLPs pass taxes and other costs to the unit holder. The unit holder pays taxes on his/her protionof the cash flow and benefits from deductable expenses/depreciation/etc. See IRS Form 1065. The merger benefit should appear in the first quarter 2014 results if the merger completes in Dec 13/Jan 14.
I look at it this way. When it looked like the SEC might never clear the S-4 and the distribution was in jeopardy due to a couple of weak quarters, the stock traded in the mid-to-upper $20 range. With the S-4/A cleared, we now know LINE has access to the capital markets again. And, the BRY deal, while perhaps expensive is said to be cash flow positive, along with a solid quarter and guidance should further secure, if not enhance, the distribution. So, regardless of the way the stock trades in the next couple of months, unless we get a negative surprise from the SEC or the deal, we should head back up over time into the mid-$30's and move on from there, so long as interest rates stay low and oil prices reasonably high. In the meantime, enjoy the monthly distributions. GLTA
Good comment and most likely right on target. Hard to be patient these days, but you are getting .242/10+% monthly to wait and bet back to the mid $30s which it most likely will do. It just hurts to see & feel these dramatic drops.