This is why the Board finally removed Phil from any decision making during the deal process and take away his Chairmanship. The process is being run by Gaylen Byker and Collin Vissagio. Phil is nothing more than a court jester.
With Phil removed from the equation, you have a world-class asset in E/A, 4 SMs, 1 NOC and JKM all bidding. I expect the deal to include an upfront cash payment of $200M - $400M. The preference is to choose one of the SMs, unless the JKM bid is vastly superior.
The largest holders of IOC have made it dead clear to the BoD that any further delays beyond the Feb 28th date are unacceptable and could result in one or more of them moving to activist status. Not naming names, but you can deduce the most likely holder(s) to consider activist status.
Sentiment: Strong Buy
Yes, while doublebagger448 was a bit harsh here, even for me, a long time Phil detractor, he clearly acknowledged something that many of us felt and that many IOC pumper longs were in denial over. Thank goodness Phil as a divisive force is no longer at the helm, will no longer divide us longs and we can move on to optimize our outcomes. As critical as I have been of Phil as the public face of IOC, I do appreciate his early vision and entrepreneurial spirit, which uncovered value for PNG and IOC shareholders. For that, thank you Phil. And to the extent that Phil MAY have realized that to step aside was best for both his IOC shares and ours, again thanks. Whoever made this decision, it is the right one. We can now get a new "face" on the company that can better represent us. Phil, for his part can continue to contribute his insights/vision as a member of the bod. I'll drink tonight to moving to the next phase of the IOC story, hopefully one where longs can have more to agree about.
Totally agree . Phil and Henry have really hurt shareholders over the last 3-4 years. Drilled maybe 4 wells, attracted no partners and aliented the Govt and the Investment world. The big 3 insitutions sold some in sept Q and I bet this last Q sold much more.
So when do you show your true colors Steve Bardack and sue IOC?
You wrote this on SA Aug. 20, 2012, a month after Mr. Mulacek was replaced by Mr. Byker as Chairman.
Looks to me your 'few weeks' have turned into 5 months with another 5 weeks to go, and you blame Mr. Mulacek's personality for your options losses. Mr. Mulacek's behavior didn't bother you back then, why the change of heart Treasure Hunter? That SA piece you wrote then still stands as one of the best cases as to why one should own IOC. Thanks for that.
"There are 2 likely outcomes over the next few weeks.
Outcome 1 is that Shell decides to preempt the sell-down process and makes an offer for 100% of InterOil. Given the size of Elk/Antelope and Triceratops and the additional 40 identified exploration leads and prospects, InterOil will not sell itself cheaply. Using GLJ's Elk/Antelope estimate of 9.4 Tcfe (this number includes the condensate liquids) and assuming Triceratops is at least of equal size = approximately 18 Tcfe. InterOil owns 58.6% of the resources. 18 Tcfe X .586 = 10.5 Tcfe. Assume that InterOil's resource will sell at least at the average of recent comparable transactions of $2/mcf. This is extremely conservative given that InterOil's production cost is much lower than other projects in the comparable set and this assumes ZERO value being given to the other 40 prospects, the refinery and downstream assets. $2/mcf X 10.5 Tcfe = $21 billion. InterOil has just under 50 million shares (fully-diluted). $21 billion/50M shares = $420/share. Regardless of the degree of further risking applied to this analysis, the result is a final transaction price equal to a multiple of the current share price.
Outcome 2 is InterOil completes a partial sell-down of E/A to Exxon (XOM), Shell or Japex/Kogas/Mitsui at $2-$3/mcf. InterOil will likely receive several hundred million dollars of cash upfront and will use the cash to markedly expand its drilling program, likely focusing on prospects Whale, Mako and Tuna next. The discovery of additional reefal formations will continue to propel InterOil's value higher.
Either outcome is a huge win for InterOil shareholders. The upcoming weeks are an exciting time to be an InterOil shareholder."
And here we have Mr B showing his true colors. As a hedge fund manager he sees the opportunity to knock down pps. Imagine that; a guy in his position posting on a Yahoo message board. We get an announcement that all is good and have a Feb 28 final bid date announced and he comes with this. At this time. Interesting.
Sentiment: Strong Buy
Who needs "insider info" - the obvious is not obvious enough for you. Years and years of frustration and tears for you dreamers ain't enough to have you wake up? This guy has not produced anything but hype and cheezy hope for novice investors. The whole thing is a house of mirrors, and I think most of the longs are lost in there. Once the house tumbles down, you'll see what we mean. Until then, enjoy your funhouse.
Don't you a fundamental problem here if what you say is true? What company is going to throw hundreds and hundreds of millions to a company, with whom they need to partner, yet they think is led by a "court jester"? Keep in mind that IOC already has an enterprise value of $3 billion, and even with a few hundred million in upfront cash, presumably because they just adore the resource, much of the value becomes back-ended. If they think Phil is a clown or not capable, they are going to put IOC in a very subordinate position and run the show. This could seriously impact the value to IOC and the stock price. Maybe this, too, is why the stock is floundering. Oh, and RC's history of activism (Sino and EWC) are a tad scary. Food for thought.
"If they think Phil is a clown or not capable, they are going to put IOC in a very subordinate position and run the show."
The whole point of bringing in a world class operator is for InterOil to cede control to an experienced player who will undoubtedly "run the show" and guarantee the project's future cash flows. Your logic is flawed since on one hand you bash InterOil for its poor management and on the other bash InterOil for giving control of the project to a major. I also think you're missing that the subordinate position pertains to this project, not to manageing InterOil and its future projects and prospects.
If Chandler were to go activist and doublebagger is right, I think the stock would double that day IMHO. No doubt in my mind it would lead to a hostile bidding war. Chandler's a billionaire and a very astute investor. You're just plucking out one of his bad investments as a guide to how InterOil will play out, but the guy has been a winner.
If I recall, doublebagger correctly informed this board of Chandler's buys every day while he was accumulating, so I believe he may know something about his activist aspirations. Very exciting.
Sentiment: Strong Buy
Boy, I sure hope Mulacek doesn't screw this up. He only has about a billion personally riding on IOC. 4 SMs an NOC and JKM and a supportive government all materialize after Mulacek is out of negotiations? Only a fool would think that. You ST guys always lash out when timelines don't your expectations.
It's pretty much Richard Chandler - Fidelity, Wells Fargo, Cap Re, and JP Morgan have gone activist a total of zero times to my knowledge - the most they would ever do is tick a box on a proxy. That leaves RC, who IMHO is essentially trapped. As a large shareholder he has to report his trades now as an insider would - unless he can get off his stock in a few days, which as a 7.3M shareholder he can't, as soon as he starts heading for the exits the street will kill him by dumping and shorting ahead of him. All he's left to do is "go activist" IMHO. Last time he tried to do it he lost 100% of his money (investing in Sino-Forest equity as the bondholders were gorging on the carcass). I feel bad for the guy - if I owned huge chunks of IOC and EWC I'd panic too.
Sentiment: Strong Sell