The bar has already been set so low SDRL may be able to beat analyst expectations, but earnings won't be good. The real drop will start to hit in the 4th quarter when rigs start off contract and hot stacking costs start to mount. There could be a bad impact from renegotiating contract rates this quarter, but I did not dig into the effective dates for those rates. I seem to remember it was immediate, but again I am not sure. Anybody remember?
I have been with the trend for over two years, I have shorted SDRL with puts and made a fortune doing it. This will probably be my last roundup for this cash cow. I still own some $8 puts Jan 2017 that I bought last summer for an average price of $1.80. I also own some short term calls in case there is some Morgan majic that is announced at the earning call. I have also done this many times, new guy.
I suspect Morgan already renegotiated the recent bank deal for SDRL. I am also pretty sure they are laying out all the options and ramifications for the remaining debt (which is actually growing at this point in time). I still think a RSS and then a secondary that would retire all debt is the best option for SDRL and JF is undoubtedly opposed to such a plan.
You pays your money you takes your chances. I added some short term calls to my long term puts because at this point the number of paths that could be taken are undefined and could be a surprise cake with a dancing girl or a turd.
Tom, you are encouraging these attacks and it does nothing but add fuel to them. Are you still holding SDRL stock? Does this ease your pain or something? It probably does nothing but make matters worse for everyone. You did not post for a long time, hope you found that more worth your while that needless provocation. I know IVO was trying to do better, see if you can make some attempt at doing so as well. It really casts a bad light on your ability to deal with things you have no control over. you blast IVO he blasts you and you both add no value inn doing this except to clog the board with trash the rest of us are forced to deal suffer through.
I watched them flashing on the screen today and I like your average theory. Makes sense and make
s me feel a little better about the robo situation.
Good info, thanks for sharing. Seems like summer driving is starting early.
SDRL has appointed Houlihan Lokey Inc. and Morgan Stanley to advise it in negotiations on restructuring of loans and bonds worth $11 billion.
Per sources, the restructuring may entail debt-for-equity swap and issue of at least $1 billion in new equity. The company has bank facilities worth $8.4 billion and unsecured bonds worth $2.6 billion. Bloomberg also reported that the company has debt of around $3.5 billion, due by end of 2017. Additionally, Seadrill reportedly has $948 million of bonds, due by Sep 2017, and valued at about 45 cents on the dollar.
If they are valued at 45 cents on the $ that should tell you something about the posibility of them being repaid.
Tom this is IVO being as nice as he can (no implied vulgarity) as part of our new be nice policy. Please keep that in mind and try to be at least civil IF you reply. I would actually chose to disregard it and move on.
DO you think the recent loan extensions solves the whole problem? They had made an announcement that a re-org was coming in June. That is what was well publicized but it was during that last buble and got little attention because of the raise. I think it was on the very day there was 149M shares traded. Or maybe a day before or after. It said they were going to issue a secondary for about $1B for debt resolution.
Yes, JF does own 24% and that is a problem. But he can be made whole with issuance of new shares after a RSS. This just kicks the can further down the road with higher rates.
Well my "call" insurance that I bought will probably expire worthless at this rate, but they were cheap and it is just good insurance. I'm okay with that. Never can tell in the short term Morgan and JF still have time to spring a surprise.