New announcement release at 19 May 2010 11:00
http://www.asx.com.au/asxpdf/20100519/pdf/31qdsp3x73hrwv.pdf
http://www.asx.com.au/asxpdf/20100519/pdf/31qdsp3x73hrwv.pdf
ADI - Adelphi Energy
- Thread starter Dukey
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$35 mill divided by the acres adi have in sugarkane.. so exclude all acreages in yemen..(which is an 8.5% interest 60 - 70 km long and 20 km wide by my estimates)
$45 mill in 2300 acres is $19,565 per acre.. yemen is free and you have $10 mill in cash
so using the cash you keep in the deal its really only cost you $35 mill, which divided into 2300 acres of AMI acres in the sugarkane gets me $15,217 an acre of sugarkane, the chalks and the eagleford combined!! and 8.5% of yemen is totally free
that gives you 6 free carried wells producing as a bonus.. so instant cashflow..
does that make my rough calculations make sense?
any corrections are welcomed..
$45 mill in 2300 acres is $19,565 per acre.. yemen is free and you have $10 mill in cash
so using the cash you keep in the deal its really only cost you $35 mill, which divided into 2300 acres of AMI acres in the sugarkane gets me $15,217 an acre of sugarkane, the chalks and the eagleford combined!! and 8.5% of yemen is totally free
that gives you 6 free carried wells producing as a bonus.. so instant cashflow..
does that make my rough calculations make sense?
any corrections are welcomed..
Sdajii
Sdaji
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I hope ADI gives out all the details, but I also hope that they put it into even simpler terms than you have there, Agentm, just to make it immediately clear to everyone, even the most stupid or time-strapped investor. Considering the wells already flowing, the cash on hand, and the potential, 40c is completely insane. I think the people concerned about not making their 65c back are going to be pretty happy pretty soon. I can't see movement taking long at all now.
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Question in regarding takeover..
if you just continue to hang onto your shares thru the takeover (if and when it happens) what happens? do you then own shares in awe? or hows it all work?
or is the best idea to sell out when you feel the price is right?
all good news! and i am glad this has also show value to AUT, i just hope Aut come in with an offer soon!!
if you just continue to hang onto your shares thru the takeover (if and when it happens) what happens? do you then own shares in awe? or hows it all work?
or is the best idea to sell out when you feel the price is right?
all good news! and i am glad this has also show value to AUT, i just hope Aut come in with an offer soon!!
AWE can only force you to sell your shares if they gain 90% of ADI's shares, they are then able by law to purchase your shares (even if you don't want to) and de-list ADI. However this is very unlikely IMO, they may get close to the 50.1% majority but that's it, I think they'll be lucky to get there. We have to remember that AWE have gained no additional shares as yet as all trades have been above the 40c mark.
This statement released finally tells us that the BOD believe what us share holders believe this company is capable of. This announcement how I read it, the BOD think exactly the same as we do, this is a crappy low ball offer and the company is worth alot more then this figure.
I liked the bit to where they said how the market was trading above the 40c mark, indicating what everyone thinks of this offer.
Very good announcement, thanks BOD for finally restoring some faith in you. Can't wait for this Target Statement, I'm pretty sure it'll cement our view on how good the companies potential is.
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I bet part of their stalling is because of what turds they look for diluting our holdings by giving away a bunch of shares at 25c recently. If they are going to tell us how massively undervalued 40c/share is, it exposes their 25c capital raising as an appallingly bad move.
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Some people are calling AWE scumbags but if not for their t/o offer do you think ADI sp will be what it is now??
Of course AWE will start off with a low ball offer. They may increase the offer later, who knows. It is just like you buying a used car, you don't start at the top end.
Takeovers happen if someone sees and asset which is in their opinion is undervalued. You will only buy that used car if you think it is a good bargain. This is business.
If the BOD of ADI is so crash hot, how is it then their sp is languishing so far behind their true value? Whichever way you want to look at it ADI holders should be thankful that AWE came along.
I think it is best to trust your own judgement whether or when it is the right time to sell.
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Looking at the announcement from ADI this morning confirms what I was suspecting when I bought yesterday. AWE's aggressive action is going to force ADI to promote itself and point out in clear terms what the future holds. This will generate interest and attention from brokers and advisors, and we should quickly see a price increase (starting immediately after the late May announcement and continuing into June in my opinion). ADI has no choice but to make their presentation, which will be out in less than two weeks, something very impressive (which shouldn't be difficult given their situation). The price can only go up from here - it's not going below 40c, I'm just sad it has happened before I had time to get some more capital together to throw in. As long as it is in the low 40s I'll be buying whatever I can afford, as I just can't see imagine it being under 45c by early June (a 10% profit in two weeks is nice) and I can easily see the offer being upped to 50-60c, or the share price getting there in response to ADI's action, even without a higher offer from AWE. With an unconditional buy at 40c and a position which is worth more than 40c, it seems crazy not to be buying in at anything in the vicinity of 40c! Seriously, we're probably going to get a better offer, we know ADI is going to put out a very impressive "look how freaking awesome we are" announcement, and we virtually know that is going to push the price up, and the know there is a backstop of 40c! Crikey, talk about a low risk investment with high upside! If I was expecting to bring some capital in a bit sooner I'd be quietly hoping everyone would continue to miss this opportunity for a bit longer. As it is, the sooner people start buying, the more chance we have of a higher offer from AWE.
With most of my money in ADI and EKA at the moment, the tipping competition leaderboard is looking very pretty this month!
This is a interesting concept I am looking at too... If I buy substanially more shares now at say 40.5 to 42c I am guaranteed 40c stop loss .. Which means a big potential up side with minimal down side (on $100k I look to loose round $3,750) ? With this in mind the questions are -
Can AWE pull out there offer all together before specified dates ?
What is the time frames for AWE to make an increased offer if they do ? Would this usually happen before the first offer expires or after the first offer expires ?
If Oil prices plumet overnight can AWE just pull out ?
There is the option of jumping into AUT which looks undervalued now but still there is no minimum price for them ..
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Adobee,
You need to look at the 35 Page report AWE released when they announced the takeover, it details AWE's rights. From memory, I believe they have to right to extend or cancel the deal when they choose.
Edit: Taken from page 12:
"Unless withdrawn, the Offers will be open during the period commencing at 10.00am Sydney
time on 1 June 2010 and ending at close of trading on ASX on:
(a) 9 July 2010; or
(b) any date to which the Offer is extended or as required by the Corporations Act.
AEL may extend the Offer Period in accordance with the Corporations Act."
There are a few references to the requirements of the Corporations Act which I don't fully understand.
You need to look at the 35 Page report AWE released when they announced the takeover, it details AWE's rights. From memory, I believe they have to right to extend or cancel the deal when they choose.
Edit: Taken from page 12:
"Unless withdrawn, the Offers will be open during the period commencing at 10.00am Sydney
time on 1 June 2010 and ending at close of trading on ASX on:
(a) 9 July 2010; or
(b) any date to which the Offer is extended or as required by the Corporations Act.
AEL may extend the Offer Period in accordance with the Corporations Act."
There are a few references to the requirements of the Corporations Act which I don't fully understand.
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I too am also considering this as we could take advantage of a short term 'safety net' for want of better words. Ofcourse alot of whether I do this lies in how I feel about AWE maintaining their offer to the July 9 date. Even if people start chewing through AWE's bid at 40cents, it would take a fair effort to get all the way through and by then we'd all be screwed given the share-hand-over legislation. So really the only threat of a considerable loss is if AWE withdraw their bid entirely.
The only reason I can imagine for AWE to have a sudden change of heart is if the oil price plummets, as you say. Have AWE attempted a takeover in the past? If so, how did they conduct themselves during the process?
hey, we all know how crappy this offer is. However, let's give AWE some credit, very very smart business move, and they shook the tree big time. Even if they don't succeed they got free PR on a company they own 33% of, and they have increased their 33% holding by 46% in one day.
Sdajii
Sdaji
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Sorry, I must have missed something. AWE increased their holding of 33% by 46%? So they now have 48%? Really? When? Huh?
I think he meant that AWE's stock value increased by 46%.... was thinking the same thing when i first read it..
When ADI had their CR raising AWE's 30% interest was taken up @ 25c a share (as well as the sophicated ones).
Wouldn't that have inceased their % holding in ADI?
Cheers on management on now asking the unsophicated ones not to sell @ 40c.
Where's ADI's managements care factor?
Sdajii
Sdaji
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This is still a brilliant investment, but I have to agree with you and say that I'm not at all fond of the way the board have treated us.
I'm amazed that the share price still has not gone up. A safety net immediately below the current price and an obvious indication that the outlook is bright (AWE wouldn't be saying "WE WILL BUY THE WHOLE LOT RIGHT NOW" unless they had thoroughly done their research and knew they were getting a good deal. Some idiot investor like you or me might wast a few grand on a bad buy, but they're not going to put millions of dollars on the line without doing a lot of research and having a solid level of certainty. People are probably sitting around thinking "When the ADI board put out their statement it'll go up", but why wait until you've missed the boat? It could jump up at any time, and the safety net will stop it from going down.
21/05/2010 Sugarloaf Operations Update - ADI
http://asx.com.au/asxpdf/20100521/pdf/31qg4mgy5sgbw7.pdf
http://asx.com.au/asxpdf/20100521/pdf/31qg4mgy5sgbw7.pdf
The reason ADI hasn't gone up is because there is still a profitable alternative option. The price of AUT and EKA allows an ADI holder to sell at near the 40c base and buy a proportionative interest in the Sugarloaf project at a cheaper price. The volume of trades in AUT and EKA show that this is happening. ADI is setting the base price at this stage. As their prices increase with more drilling and flow results so will the ADI SP. There is plenty of upside room left here in my opinion.
Sdajii
Sdaji
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I realise that's what people are thinking, but buying ADI seemed like a better idea. Perhaps today is different (and we're seeing that with a slight drop in ADI's SP). I bought ADI after the AWE offer, and it has held, while AUT and EKA have both dropped since then. In the short term it seemed like a safer option, and it looks like it turned out as I expected. Of course, the global collapse is a bit more extreme than most people anticipated. The last few weeks have been a lovely time to be in ADI (and/or the other two).
The severe market collapse might be enough to slow this rocket down for long enough for me to get some more fingers in. I'll have to get my tax return in early this year so I can get that in too.
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No doubt about it, the companies that are consolidated in the eagleford play have alot to gain from here on. The risilience of AUT/ADI/EKA to go against market trends (except AUT which has copped it a bit in the last few days due to short term profit takers) has shown how keen holders are to keep a share in the extremely big potential of the JV.
