RE: Monke Spank, you're not using logic“I find it surprising you would suggest IAE cannot raise the needed funds for development but you think END can raise the funds on top of their existing high debt load to buy out IAE.”
As of Jan 1, 2008 END has US$ 266.25mm in debt against Q1-2008 CF of just US$36.3 mm (US$145.2/yr annualized).
So their debt is 1.83X their yearly CF from current hedged operations. That’s one of the reasons that they are coming in with this stink bid. It is harder to get the $150 mm in cash (more debt) that they don’t currently have to finance this deal when they already have a large debt burden. That will be a total of US$416.25 mm in debt if the deal goes through, without adding on the Athena + Jacky debt that is needed to develop both fields + the US$22 mm for Beatrice that IAE is getting debt to pay for. That would put the total debt of the combined company close to US$850 mm ($325 mm for Athena + $90 mm for Jacky).
Dana has US$1 billion in cash on its balance sheet. They along with other companies in the same boat are real contenders if they want to be.
END is hoping to get this for nothing, b/c they can’t overstretch their balance current balance sheet.