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InterOil Corporation Message Board

  • pickboone pickboone Jun 19, 2013 8:10 AM Flag

    New Revelations

    IOC shareholders are understandably frustrated with the stock's performance in the past month, but the volatility is just a function of some misperceptions that are very close to being reconciled. Management has not discussed the specific terms of the deal with anyone, but a large institutional shareholder came away from recent relevant conversations and meetings with the following takeaways:

    1) The material terms of the deal were agreed to at least 1 month ago, and IOC management is literally not even involved in the remaining process, which just comprises attorneys drafting final contracts -- the deal should be announced very soon.

    2) IOC management seems to be extremely happy with the outcome of the sell-down with XOM, and they're anxious and excited to announce the details. He is convinced that IOC's BOD voted unanimously to accept the XOM offer, indicating that the bid terms must have been very compelling.

    3) The bidding was very competitive, with multiple majors, implying IOC selected the best outcome among many alternatives.

    4) A new paradigm for IOC is about to begin, with a new CEO, extensive drilling, progressive sell-downs and commercial opportunities, etc...

    5) While management is typically rattled by the stock's volatility, they come across now as very confident and undaunted by the short term irrationalism knowing that the truth will soon be revealed and will be a game changer for the company.

    6) There has been a concerted effort by IOC's "competitors" to spread misinformation, and IOC management believes that there may be an effort in motion to buy the company before the XOM deal closes.

    With approximately 30 days remaining until XOM's exclusivity expires, I believe a deal will be announced in the next 2 weeks. The government has already accepted the XOM deal, and any insinuation to the contrary is just noise. After years of being flat despite significant fundamental value creation, IOC's stock should double over the next month or so.

    Sentiment: Strong Buy

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