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Pacific Coast Oil Trust Message Board

  • fl_geezer fl_geezer Sep 19, 2013 3:51 PM Flag

    new question:

    news release says:
    Pacific Coast Oil Trust priced a a public offering by Pacific Coast Energy Company and other selling unitholders of 13.5 mln trust units at a price of $17.10/unit

    If PCEC is the seller (and the parent company), why is the Trust (ROYT) doing the pricing?
    These are not shares the Trust owns, the Trust is not issuing these shares as new, it it not getting any of the revenue from the sale (all goes to PCEC, the seller) - - - so why is ROYT doing the pricing?

    ps// and why don't they issue a press release to explain this situation and correct the down-draft?

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    • PSEC is selling their holdings of ROYT. It is ROYT units that are being sold but these are existing units so there is no dilution.
      When a big chunk of units is sold it has to be at a discount in order to be able to move that quantity of units.
      And the market price will typically decline to that discount due to the psychology of "if the parent thinks it is worth selling at $17 then why would I pay more than that".
      But it's a temporary impact - no cause for concern. It won't affect your distributions.

    • ("Pacific Coast Oil Trust (ROYT) (the “Trust”) announced today the pricing of a public offering by Pacific Coast Energy Company LP (“PCEC”) and other selling unitholders")

      ROYT did not price it, they announced it. The price was established by the buyers and sellers.

      Sentiment: Strong Buy

    • "ps// and why don't they issue a press release to explain this situation and correct the down-draft?"

      Let's hope that happens sometime before the market opens tomorrow. However this stock always seems to rebound quickly, tomorrow should be a great day for anyone that bought today. JMO

 
ROYT
10.29+0.24(+2.39%)Jul 24 4:02 PMEDT

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