RE:RE:Something for PRE Longs to Keep in Mindsaltaja wrote: BigGreenWhale01;
Two issues with your post:
1) O'hara group can't buy more as they are at 20%, so I don't see them shorting to buy on dips.
2) the 100 million penalty only applies after the deal is accepted (in July) and a later completing offered (which Alfa doesn't match) is accepted.
That said I agree the risk of no deal happening is low. O'hara has said they oppose the deal, but I think that is mostly talk. They have also said they are investors. They have an average share price of around $5 probably. Why let this tank to 2.5-3, putting their capital at risk, in the hope oil will recover before debt gets PRE. If their backs are against the wall I say they take 6.5, for a nice profit and move on. That is what an investor would do. Alfa sees this, which is why they are holding firm at 6.5.
Options I see are:
1) 6.50 closes
2) O'hara finds another bidder who wants to pick up Latin Am oil assets and we get a bidding war.
All IMHO GLTA!
Hi Salty (Apologies for the delay responding. This site has major issues)
Yes. You're correct about their PRE %age position)
However.. there is nothing to prevent the interested individuals purchasing shares INDIVIDUALLY and outside the investor group, thus adding to the aggregate dissentor shares quantity. I believe 2/3 of the OS shares are required for approval of the deal.
You may be correct about your 2nd point, though.. I'll have to look into that, as I'm unsure if PRE management's current commitment isn't suffice for the penalty to be in effect.