Another one which has flown under the radar.
Up 17% since posted in Charts of interest.
Did anyone get aboard KAR before it took off this week?
Yesterday the company announced that its wholly owned subsidiary Karoon Petróleo e Gás Ltda has signed a binding sale and purchase agreement to acquire a 100% interest in the Baúna oil field in the Santos Basin, Brazil for US$665 million.
The company is proposing to fund the acquisition of Baúna with a combination of existing cash, debt, equity and pre-completion cash flows from the acquisition.
The Baúna field consists of two producing oil reservoirs, Baúna and Piracaba, which are currently producing light sweet crude at a rate of approximately 20Mbopd. It has total reserves and contingent resources of ~68 MMbbls and KAR is targeting production growth to an average of ~33 Mbopd during 2022.
Overall, it looks like a pretty solid acquisition that will produce strong stable cashflows over the medium to long term.
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KAR like most of the oilers, pump and dump quite quickly
Will be interesting to watch so see what it has left in the SP tank
Y I won't be surprised to see it gap back to $1.12 one day this week.
Not sure if its ready to gap, but yesterday's "bar" indicates this is ready to move up again … (if I'm reading it correctly)
If you add up total volume from the gap down in October selling far exceeds buying.So the question is has supply been exhausted.
One frustrated shareholder dumped a line of 15.24 million shares in Thursday afternoon trade, worth about 3 per cent of the company. The trade went through UBS' equities desk and was at 58.25¢ a share, which is about what the stock traded at for most of Wednesday and Thursday. Funds were told it was one institutional investor selling to another. But still, it raised eyebrows.
AFRIt comes as Karoon is trading at a significant discount to its cash backing and the company is under pressure to return cash to shareholders. Karoon had $504.5 million of cash and no drawn debt at March 31, and about a $320 million market value.
Of course much of the cash is to cover its proposed Bauna acquisition in Brazil, although there is doubt about whether the investment case will stack up and the deal will complete given economic and financial market changes.
Works both ways.... I haven't been following KAR, but I presume this isn't beneficial.Oil producer with exposure to Brazilian oil industry
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