Australian (ASX) Stock Market Forum

LNC - Linc Energy

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dogeatdog said:
Trading halt in place until next Tuesday, or until a "material fund raising" announcement is made by the company.

Your thoughts people?
Click to expand...

Could be dilutive! Why does a company with professed substantial coal assets (*soon* to be sold - well ... fairly soon - well .... surely some time or other) need to raise capital?
 
Page 2 of announcement, dot point 1: Material capital raising

Looks like a conv bond issue - out a few minutes ago on via Dow Jones Newswires
 
skyQuake said:
Page 2 of announcement, dot point 1: Material capital raising

Looks like a conv bond issue - out a few minutes ago on via Dow Jones Newswires
Click to expand...

Here is a report on a possible Convertible Bond Issue from WSJ-

"Australia’s Linc Energy Ltd. LNC.AU is attempting to raise about US$200 million through an issue of convertible bonds, two people familiar with the raising said Wednesday.

The bond issue is being managed by Credit Suisse and will convert to equity in 2018, the people said. The funds will be used to develop the company’s assets, one of the people said. Linc owns coal and oil assets, mostly in Australia and North America."

http://blogs.wsj.com/dealjournalaus...eks-around-200-million-from-convertible-bond/
 
Jason695 said:
Could be dilutive! Why does a company with professed substantial coal assets (*soon* to be sold - well ... fairly soon - well .... surely some time or other) need to raise capital?
Click to expand...

Why? Because they sell nursery rhymes and

Bond and co have done very well over LNCs 16 years of loss making.
All it took was one great discovery - the stock market!
Click to expand...

You just witnessed one of the greatest ramps in history moving into a capital raising.
 
Further update on the Convertible Bond issue-

"Australia’s Linc Energy Ltd., a coal and oil producer, is attempting to raise at least US$200 million in an issue of unsecured convertible notes, according to a term sheet seen by The Wall Street Journal on Wednesday.

The funds raised will be used to develop the company’s assets, a person familiar with the matter said. Linc owns coal and oil assets, mostly in Australia and North America.

The issue is being managed by Credit Suisse and its size can be increased by US$50 million, the term sheet said.

The notes will convert to equity in April 2018 at a price of 3.40-3.54 Australian dollars (US$3.56-A$3.71) a share, representing a premium of 27.3%-32.6% to the stock’s last traded price of A$2.67. The conversion price can be lowered by a maximum of 20% of the initial conversion price.

Linc can offer to buy back the notes, which are fixed at an exchange rate of US$1.0463 per A$1.00, from April 2015."

http://blogs.wsj.com/dealjournalaus...n-from-convertible-bond/?KEYWORDS=linc+energy

Looks like good news to me. Not a done deal yet, though.
 
Market has turned on a sixpence for LNC this morning. DOWN 11%.

I agree that the capital raising looks clever and will be very useful. Any thoughts on change of sentiment ?
(There have been comments on another forum that the earlier sharp increases in the SP had been fuelled by Credit Suisse who then sold the finance deal - and have now taken a profit on the earlier push ..)
 
Deal for convertible bonds just confirmed on the Linc web site.
SP down to A$2.31, a 13% decline from opening as I write.
The roller coaster ride continues.
(LNC share holder)
 
I was happy to buy more at the 2.25 support level on Thursday and will look to buy more in the future. It's an investor story for me and this looks to be on sale so I am happy to commit some more $$ for the long term. Key thing is to see if the support can hold and what future news reports will be announced.
 
Uncertain times for LNC S/P since issue of Convertible Bonds.

LNC started trading again on 28 Mar after announcement of issue of $200M CBs.

Short sales on 28 Mar were 6.3M. You can check daily short sales here -

https://www.asxonline.com/intradoc-...lectionID=68&SortField=dInDate&SortOrder=Desc

It was reported that 60% ($120M) of the CBs were allocated to Hedge Funds.

There is some talk of Hedge Funds using both short sales and CBs as an artbitrage strategy.

I am no expert but here are some references that explain the strategy-


http://www.barclayhedge.com/researc...edge-fund-strategy-convertible-arbitrage.html

http://www.investopedia.com/terms/c/convertible-bond-arbitrage.asp

http://en.wikipedia.org/wiki/Convertible_arbitrage

It has also been reported that PB has a loan agreement with Credit Swisse to lend his stock for short selling purposes.

http://www.theasset.com/article/23957.html

Some are stating that it will be very difficult to follow the trading pattern of LNC at least until the settlement date for the CBs- ie 10 April.

Be warned !

L/T Holder
 
Yes I read that info too Mickel, tough to take when the big boys short the stock knowing they can pick up the cb's at 3.40 in the future. It explains the drop in the sp which looks overdone to me, but the shorts have the upper hand ATM. It is frustrating but I see it as a buying opportunity all the same. Hopefully the 200 M is for a worthwhile cause that will deliver a better outcome for us SH?
 
Skivvy, I agree it is a buying opportunity. But when will it bottom in the short term ? Still, with all the good news "in the wings" $2 is an attractive price. And more so now they are "cashed up".

This is what BBY have to say on LNC after the CB issue-

"Linc has retired the A$90M 13%p.a. Fortress facility following the issue of an A$200M convertible note. The interest rate is 7%p.a., the conversion price is A$3.40/sh, and the maturity is 5 years, with a non call period of 2 years. After this issue, Linc will have A$180M of available liquidity, which will strengthen its negotiating position in respect of Joint Venture negotiations on UCG projects, the Wyoming Enhanced Oil Project, the Arkaringa shale oil farm out, and Linc’s risk capacity in respect of drilling in Alaska and sub salt Wilcox oil/gas plays in Texas. We believe there is considerable potential upside to our price target of A$3.40/sh. Umiat drilling is the closest upside trigger."

http://www.bby.com.au/bby-insights/...-note-issue-increases-flexibility-to-deliver/
 
Unnerving to watch the continued crash in LNC's SP. All the LNC news is good and we don't even have a shooting war (yet) to justify a mass loss of confidence !! (God help us if that happens..)

Really feel as if the market is a giant shell game at the moment.:bad:
 
Anxious times with the North Koreans flexing their muscles, lnc is still getting pushed down and the increased volume today on yesterday is a part of this market concern. Where is the bottom who knows, but I am looking under every rock to be ready for the reversal. In my opinion Linc still represents some of the best growth opportunities in the market, but value doesn't always get reflected in the sp, that is why it is called a "market"
 
I'm not a legal person, but maybe one of you folk can analyise, and enlighten us, based on this link, with regard to the recent $200m fund raising process. www.otciq.com/otciq/ajax/showFinancialReportById?id=102264
It seems the 10th of April may offer some clarity to which direction the sp may move, at least in the near future.
(LNC share holder)
 
dogeatdog said:
I'm not a legal person, but maybe one of you folk can analyise, and enlighten us, based on this link, with regard to the recent $200m fund raising process. www.otciq.com/otciq/ajax/showFinancialReportById?id=102264
It seems the 10th of April may offer some clarity to which direction the sp may move, at least in the near future.
(LNC share holder)
Click to expand...

Doggy, I think this scripted interview with Peter Bond today answers your queries-

http://www.lincenergy.com/data/asxpdf/ASX-LNC-476.pdf

Also, the 26.5c increase in the S/P to $2.08 today is confirmation that he is correct.

Hopefully there will be more increases in the coming days.

LNC is in a stronger position now to proceed with its many profitable opportunities.
 
geoffgm3 said:
I think something is about to happen at Linc! waiting on announcment.
Click to expand...

Geoff, would it have anything to do with the Gasfields Commission Bill being discussed in Parliament this afternoon/evening ?

This is listed in order of business for the parliament-

"GASFIELDS COMMISSION BILL (Explanatory Notes)
Introduced by: Deputy Premier, Minister for State Development, Infrastructure and Planning (Mr Seeney)
Date introduced: 27 November 2012 (Record of Proceedings Proof p. 2754)
Status: Referred to State Development, Infrastructure and Industry Committee on 27 November 2012 (to report by 27 March 2013 as advised to the House on 27 November 2012)."

http://www.parliament.qld.gov.au/documents/tableoffice/notice_paper/2013/130416_NP.pdf
 

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