I would lean to the higher figure, at least. Which means the market has nearly discounted (on an after-tax basis) a complete write-off of the wells. That is probably appropriate as everything this CEO touches seems to turn to.......well, you know the rest. The wells were never a stroke of genius. But the company's base businesses were looking break-even so they probably felt they had to do something. Other than return money to shareholders of course.
Well, the Wilhemsen guys probably don't care. They have ruined the public market value of their company to be sure, but they know there is a realizable private value for the rigs. Was their sale of stock less than brilliant? Of course it was. They either don't know how public markets work or really don't care. They are really just in to buying assets cheaply. It's the mom and dad that are looking to pay for their kids' college education or setting up for retirement that got nailed on this one. It has further to go.
At market value less any net debt to see what the downside support might be? There appears to be no downside support, must be a massive sale order in place is all one can think. Shareholders are really irate, but it has to be getting close to realizable asset value. However, markets can get really overdone anyway. These aren't judicious stock sales, these are emotional and angry stock sales.
for years due to overcapacity and lower oil price. Does it make any sense? You can't really forecast oil price, but the orders for new rigs are on the books for sure. Risk is older rigs get cold-stacked, and even a few newer ones just get run at cash break-even to keep the crews together. Think the forecasts are a bit too negative, but they sure are out there.
And unfortunately, guys like that never tend to admit their mistakes and sure as hell never resign. He's carded a triple bogy and is looking for a mulligan. Failure never stops me is the standard refrain from these types.
It is becoming a bit of an expensive sandbox the CEO is playing in. I think i am coming around to your view of the guy running this chuck wagon. You'd think he would want to have something to show for years and years of work. I'm sure he is trying his best to provide return to shareholders. Apparently he's not very good at it.
Enough uncertainty surrounds it now that a few portfolio managers will probably bail. It is a material and significant event or they would not have had to file an 8K.
Not far from current levels. Even w/ lower oil prices, a stronger dollar, contract extension uncertainty for the wilhunter and a very soft floater market later next year, It is hard to see this dropping below $16. Lower oil price could produce a U.S. dollar north of 7 NOK, and well de- commissioning work is highly variable and somewhat postponable, but the yield is discounting those risks. The riskiest situation would be if the option on the rig is not picked up and they have to scramble to get it contracted w/another operator, but they would have a year to find work for it. The market hates uncertainty but it is mostly discounted by the recent $8 per share price drop.
still under a one-half position and still ok w/that. At some point I figure the CEO will realize that holding a 20%+ position and playing in the sandbox w/all the toys isn't generating any return and he will trade in his hobby activity at a better price to someone else. That's assuming he is a hard-nosed businessman and not a hobbyist.
yeah, I thought these wells were "state of the art", full researched, we know exactly what we are doing and not entering any formation level that would likely cause an earthquake or seismic event. The other guys that did that were drilling in the wrong formations. We won;t go anywhere near that. Bottom line I see to possible upshots: The next referendum to stop injection wells finally passes because of this. The wells may have to be written off. It's a "relatively minor event", unless it happens in your neighborhood. Luckily as you say AWX laid off some of the risk as well as reward. Stock is still cheap w/o the wells. It's a good thing that is the case as that a may become reality.
I think they just waited too long to hire an advisor and explore strategic alternatives. That is admittedly easy to say w/20:20 hindsight, but it should have been done a couple years ago before pursuing all the share offerings. Insiders also granted themselves way too much stock and, in the end, will be left w/little because of it. I have no axe here, sold mine in the $3s, just dumb luck after feeling I had been fooled more than once. Once should have been enough and I would have had an even better exit.
Not frauds, just opportunists who know when to sell an overbought security. The haircut they took to get out was well worth it and saved them significant further downside. Just look at where it is selling now. I think they are pretty smart and know what they are doing. Did small shareholders get caught in the crossfire? Maybe.The real question to ask is what the insiders WIlhelmsen and QVT (whose CEO is on the board) know. No one is in a better position to know then they are and they sold the stock.
Fool me once. These guys seriously jammed their own shareholders. They'll do it again when they need more money. So, no.