ADI - Adelphi Energy

Agentm said:

philly

anyone can do as they wish in this takeover, but why cant the ones who urge holding out not discuss any possibility of a downside in their less than convincing ranting of bullying ?

i think its a fair question to ask.. and i am very curious as to whether those advocating holding can put forward a very compelling and fair answer as to how the adi wont tank past the expiry date, as i said, i have a good holding in adi and i am waiting for some clear answers here..

always in for better value, but where is the clarity here, is someone just guessing or wishing for a higher price on adi here? or can someone post up how the adi price will rise immediately post the july 9 deadline?

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agentm
I concede that there is nothing I can post to say the SP will rise post 9 July. The reality is as you and nokia both say the SP could fall post 9 July
As I said in my previous post there is a subtantial premium built into the offer price so when the offer closes the premium will disappear.
I am re-assessing my position and I am leaning more towards selling just prior to 9 July

philly said:

agentm
I concede that there is nothing I can post to say the SP will rise post 9 July. The reality is as you and nokia both say the SP could fall post 9 July
As I said in my previous post there is a subtantial premium built into the offer price so when the offer closes the premium will disappear.
I am re-assessing my position and I am leaning more towards selling just prior to 9 July

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I would say with CGT quite a few more ADI shares will be sold as of the 1st of July.
Personally i'm disappointed as i've been holding a few years now and was hoping for a better result also.
None the less i've sold the majority of my ADI shares and kept a small portion in case of a miracle.
I'm leaning towards a dip after the 9th but i"m puzzled as to why ANZ nom has increased its holdings as well Comsec ect coming on board.
That must be a positive for holders but can someone explain as to why the interest and increase with them?

Hi folks,

I've been watching this for a while now and would like to throw my 2 cents on the matters.

I think everyone needs to thing logically and put themselves in AWE's position - why would they buy into ADI if their sole purpose was to not make a buck? Clearly, if the value of the SP goes down, they are at a loss too and a significant one for that matter given their size of the pie. Keep in mind that they wanted to purchase 90% of ADI's issued shares, why/how could a publicly listed AWE privately run a company? It can't. What it can do (and I assume is a potential move apart from running ADI with business as usual) is to do a share offer placement. I.e. x AWE shares for x ADI shares. That way with a lower SP, it makes a bigger gain. The value of ADI is therefore is diluted within AWE. Note however, the overall value would still equate (in the long run) greater than 42 cents - everyone including AWE is a winner but with AWE a bigger winner in this cases.

In order for that share placement to work, they need to justify a fair trade value to occur. If the SP goes down post 9th July, they may instigate a lower trade giving AWE greater value however, I can't see this happening given independent reports which have a higher target value. It would be hard for them to justify such an action as there is potential for class action suit from minority shareholders (which includes firms far larger than AWE) as there is clear information publicly available now demonstrating a higher value of the ADI shares.

The other possibility for AWE's move is that they want to run ADI with business as usual. All they wanted given their large stake is to have control of the board. I would too if I had more than 50% worth of shares. They clearly know ADI is undervalued. For them, this was a project decision with a clear benefit realisation target for x dollars investment to turn it into x more dollars. Surely change of board is a risk, but for AWE, it is in their best interest. Maybe it will be the best interest for all of us considering their size and management experience in comparison to ADI.

In summary, AWE is trying to make some cash. Right now, it is intimidating to see a large ownership of ADI go into their hands therefore people are flocking out. Great news for AWE as the more they buy, the more they will make. Not sure what the short term implications are for other share holders but in the long run, there is still value IMO. Remember, BoD have a defined set of rules and regulations for their job within a LISTED company. They should be doing their best for their shareholders whoever that may be.

Disc. I hold ADI shares.

i would like to know, does Adi currently have any contracts with hilcorp? do they have a certain amount of wells they have to participate in? surely if the above to are a yes, the price should eventually increase if AWE actually run the company similar to how its been run? you'd think if they were trying to delist this company and gain over 90% control they'd want to to turn over money like Hendeus has mentioned above

Or what else could be on their plan?

Here's my thoughts - dyor.

AWE have a lot of cash and a 200mil unused debt facility. If they get ADI, they'll go after the others.

AWE love to spin off companies and then buy them back later on.

Piece these two together and you have a spin off that encompasses some classy eagleford acreage - that will make a tidy profit no doubt.

Yes Agentm I too believe we'll be seeing lower prices post close of offer. I think that's normal market psychology. It would be odd not to have a few people go 'oh crap offer's closed, time to liquidate'. I do think that we'll also be seeing considerable numbers sold come wednesday through friday.

I think people should make up their own mind's - but don't be concerned about ADI being run into the ground - because it's only a minor player in the JVP I can't see that happening, it's not in control of the throttle. I do believe there is a clause that lets ADI get out of participating in a well, but then it forfeits share in profits of course - now nobody in their right mind would do that. What is to be concerned about is AWE's threat of causing dilution. AWE's people on the ADI board can cause capital to be raised whenever they see fit. This can (correct me if i'm wrong) be completely taken up by AWE. The way I see it, if AWE get's close to 90%, they could raise capital, dilute everyone else and then sneak in above the 90% - wouldn't put it past them to do this.

Time for everyone to have a long hard think about what to do.

AngusSmart said:

i would like to know, does Adi currently have any contracts with hilcorp? do they have a certain amount of wells they have to participate in? surely if the above to are a yes, the price should eventually increase if AWE actually run the company similar to how its been run? you'd think if they were trying to delist this company and gain over 90% control they'd want to to turn over money like Hendeus has mentioned above

Or what else could be on their plan?

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Hatchy said:

Here's my thoughts - dyor.

AWE have a lot of cash and a 200mil unused debt facility. If they get ADI, they'll go after the others.

AWE love to spin off companies and then buy them back later on.

Piece these two together and you have a spin off that encompasses some classy eagleford acreage - that will make a tidy profit no doubt.

Yes Agentm I too believe we'll be seeing lower prices post close of offer. I think that's normal market psychology. It would be odd not to have a few people go 'oh crap offer's closed, time to liquidate'. I do think that we'll also be seeing considerable numbers sold come wednesday through friday.

I think people should make up their own mind's - but don't be concerned about ADI being run into the ground - because it's only a minor player in the JVP I can't see that happening, it's not in control of the throttle. I do believe there is a clause that lets ADI get out of participating in a well, but then it forfeits share in profits of course - now nobody in their right mind would do that. What is to be concerned about is AWE's threat of causing dilution. AWE's people on the ADI board can cause capital to be raised whenever they see fit. This can (correct me if i'm wrong) be completely taken up by AWE. The way I see it, if AWE get's close to 90%, they could raise capital, dilute everyone else and then sneak in above the 90% - wouldn't put it past them to do this.

Time for everyone to have a long hard think about what to do.

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any jvp member can opt out of any well they please. they would lose their rights to that well

awe would participate in all events from now on.

what awe would not do well is promote adi, where is the rationale in doing that?

with the current directors and with new directors with different motivations (delisting) its obvious the company will be run as needed to that end.

my capital will obviously be removed from adi just as soon as it suits me.

but i will not have my capital in a company who's directors are primarily there to delist the entity..

i know far better places to invest my capital

for those who have faith in the new awe management taking over and their goal of delisting adi.. best of luck

good luck if you think adi will reach $1 b4 they delist and good luck if it goes above the current bid price..

as many have missed the point of the on market offer and the meaning of the final offer, my own view hatchy is that post 9th july, the volumes will be very small if anything, a handfull here and there.. and the share will meander and tail off downwards and be forgotten..

just my own view.. i cant see any one having the desire to trade in the share and keep it in their portfolio.

all imho and dyor..

My speculation was all wrong, them the breaks.

Can't blame AWE for taking advantage of circumstances whilst their offer is opportunistic , its also created an opportunity for me to shift my sizeable holding, in what would become an even more illiquid stock.

While investing in the spec end of town is risky and although each new Well in the Eagleford derisks the play, the ironic thing is the unknown risk which I cant quite guage is AWE and its full tilt holding.

I will be looking to shift come the new financial year, and on reflection ,considering the market as a whole on its shakey direction AWE have done me a favour.

Agent M, thanks for the info you have given ,much appreciated.

I am still interested in the Eagleford but will just sit on the sidelines for now and whatch , as there will be many more capital raisings to come for the jvp's.

Adious,

Argentina to win World Cup.

AUT looks pretty cashed up at the moment.

Thanks to BP (Amoco arm) and Obama, deep sea exploration isn't flavour of the month. Big Oil needs to be able to put reserves on balance sheet and the Sugarkane field is onshore, in Texas (do they allow Greens across the border? Or are Greens to Texans simply an over-cooked variety of limp cabbage) and trendy. There seems to be little exploration risk and gas/oil break-even prices are pretty low.

I don't personally feel that it's a time to be sitting on the sidelines. That doesn't mean reinvest the whole lot. Things are generally a bit rocky and chartists don't seem to be able to work out the charts at the moment. Volume is generally low. One major piece of bad news and investors might run for cover. There's no telling. But AUT's projects look sound.

I'm taking a cautious stance but re-applied some of the proceeds in EME and AUT. I feel that you need to be able to take a longer view in the current market which means being able to stand the sight of downward swings (if they occur) before recovery and to be able to hold through the swings (ditto).

I've decided to sell but at my price. My price is 60c which is still daylight robbery but a fair value according to the experts. I'm hoping enough will hold out for that price to force the hand of AWE. They are not the only ones that can deal hard. I think it is time to "hold em" the time to "fold em" is not here yet.

That is my opinion DYOR.

jetblack said:

My speculation was all wrong, them the breaks.

Can't blame AWE for taking advantage of circumstances whilst their offer is opportunistic , its also created an opportunity for me to shift my sizeable holding, in what would become an even more illiquid stock.

While investing in the spec end of town is risky and although each new Well in the Eagleford derisks the play, the ironic thing is the unknown risk which I cant quite guage is AWE and its full tilt holding.

I will be looking to shift come the new financial year, and on reflection ,considering the market as a whole on its shakey direction AWE have done me a favour.

Agent M, thanks for the info you have given ,much appreciated.

I am still interested in the Eagleford but will just sit on the sidelines for now and whatch , as there will be many more capital raisings to come for the jvp's.

Adious,

Argentina to win World Cup.

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best of luck jetblack, happy to share research with all.. and i hope all made some huge gains on the share

i particularly enjoyed the .6 to .42 run myself

even the derisked .22 run to to .42 from the awe bid was a great run also

agree on the cap raisings for the jvp and sitting it out,, currently in the same mode

estseon said:

AUT looks pretty cashed up at the moment.

Thanks to BP (Amoco arm) and Obama, deep sea exploration isn't flavour of the month. Big Oil needs to be able to put reserves on balance sheet and the Sugarkane field is onshore, in Texas (do they allow Greens across the border? Or are Greens to Texans simply an over-cooked variety of limp cabbage) and trendy. There seems to be little exploration risk and gas/oil break-even prices are pretty low.

I don't personally feel that it's a time to be sitting on the sidelines. That doesn't mean reinvest the whole lot. Things are generally a bit rocky and chartists don't seem to be able to work out the charts at the moment. Volume is generally low. One major piece of bad news and investors might run for cover. There's no telling. But AUT's projects look sound.

I'm taking a cautious stance but re-applied some of the proceeds in EME and AUT. I feel that you need to be able to take a longer view in the current market which means being able to stand the sight of downward swings (if they occur) before recovery and to be able to hold through the swings (ditto).

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lots of swings and with usa in a double dip, i am not keen to dabble in the shares other than the one i have a holding in.. (currently sbr only after taking all others into cash)

still researching the many on my watch lists, but not at all keen on anything out there atm..

30 June 2010
The Manager
Australian Securities Exchange
Company Announcement Office
20 Bridge Street
SYDNEY NSW 2000
Dear Sirs
ARC ENERGY Limited’s Takeover: Form 604 – Notice of Change of Interests of Substantial Holder
ARC Energy Limited ABN 74 009 204 031 (a wholly owned subsidiary of AWE Limited ASX: AWE) advises that its current substantial holding in Adelphi Energy Limited (ASX: ADI) increased on 29 June 2010 from 56.374% to 57.494%.

It seems we well be getting a report like this up untill the 9th..

my guess is, about 67% they will end up with.. still unsure what i want to do, since Aut has taken a hit since its CR information has been mailed out.. now below the current CR offer if anyone was thinking to pick some up..

the volume will increase dramatically in the last days..

aut has fallen day by day, today its at the .75 cap raising price and a bit below..

i thought it would have arrived at .75 a lot quicker, some very lucky sellers out there when you look at what they got last week..

will be very intrigued to see the jvp prices strengths or weaknesses in the absence of the awe bid..

wonder what the floor will be on this rout??

Yeah i agree that the volume will increase near the end, there still seems to be a few who'd i think want to hold on beyond the offer since they bought in at much higher prices, i might just flip a coin to decide what to do, since i didnt really risk all that much when i jumped in.

Re: JVP/AUT You'd think there would be some sort of drop once the offer expires, since there was a dramatic rise (AUT:60c to 80c) when the offer was put in place.. even with the news we've had since the offer they seem to add on average 5c per announcement, and lately drop off a few days after... time will tell for sure!

whoever got out at 88c was surely lucky, in it for the long term however so not all that concerned with Aut.. unless some takeover bid was to jump up outa no where....

have to be some sort of record perhaps

lol

GS left today.. 4.2 mill

leaves nioka to switch the light off later on when he leaves..

Just had a call from Arc asking what my intentions were regarding the offer. I'm by no means a large holder so no idea why they should ring me. I said I would make a decision late next week.

Lert said:

Just had a call from Arc asking what my intentions were regarding the offer. I'm by no means a large holder so no idea why they should ring me. I said I would make a decision late next week.

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Yes I had the same caller and expressed my total disatisfaction
in the way the whole thing was handled.They absolute con artist in the first degree.

ARC ENERGY Limited’s Takeover: Form 604 – Notice of Change of Interests of Substantial Holder

ARC Energy Limited ABN 74 009 204 031 (a wholly owned subsidiary of AWE Limited ASX: AWE) advises that its current substantial holding in Adelphi Energy Limited (ASX: ADI) increased on 30 June 2010 from 57.494% to 64.695%.

Well with 26 million going today, it's fair to say that this show is on it's last legs. I calculate that the dirty cockroaches have 80%.

So.
If they get 90% before the close next friday, will that mean that they shut it all down?
If I don't sell before that time and I get caught after they've shut the shop, will that mean that they will send me a cheque?
Oh so many questions.

2 July 2010
The Manager
Australian Securities Exchange
Company Announcement Office
20 Bridge Street
SYDNEY NSW 2000
Dear Sirs
ARC ENERGY Limited’s Takeover: Form 604 – Notice of Change of Interests of Substantial Holder
ARC Energy Limited ABN 74 009 204 031 (a wholly owned subsidiary of AWE Limited ASX: AWE) advises that its current substantial holding in Adelphi Energy Limited (ASX: ADI) increased on 1 July 2010 from 64.695% to 80.467%.


SUGARLOAF AMI PRODUCTION UPDATE
Aurora Oil & Gas Limited (“Aurora”) is pleased to provide the following update on production at the Sugarloaf Area of Mutual Interest (“AMI”) within the Sugarkane Gas & Condensate Field, Texas.
Production Update

The following wells have reached the 60 day production milestones:-

Fractured Horizontal Length (ft)
Total Gas Production (mmscf)
Total Condensate Production (bbls)
Average Daily Equivalent Gas Rate (mmscfe/d)*

Morgan #1H

4400
201
65,200
17.2

Easley #1H

2750
221
19,600
8.5

* The equivalent gas rates have been calculated to reflect value using a 12:1 conversion ratio for condensate and a 25% uplift on gas equivalent volumes due to the high calorific value of the produced gas.

These additional production figures continue to be very encouraging for the economics of the field. Further production updates for these wells will be provided in quarterly reports going forward.
ASX participants in the Sugarloaf AMI are:
Aurora (ASX:AUT) – 10% (post farmout)
Adelphi (ASX:ADI) – 10% (post farmout)
Eureka (ASX:EKA) – 6.25% (post farmout)
Aurora also participates as a 50% WI holder in a larger area made up of an additional ~ 27,000 acres within the Sugarkane Field adjacent to Sugarloaf. Aurora is the only listed participant in these areas which are also subject to farmout to Hilcorp for the drilling, stimulation and tie in of a further 4 new wells (please refer to earlier releases).