Post by
mrmomo on Sep 07, 2023 8:36am
Peyto buys Repsol Canada....
And this marks the end of an era for foreign/EU investment in Canada's energy sector. And with Repsol's departure, the last reamining member & hold out, marks the ENTIRE exit of nearly ALL of the Europeans from the Canadian O&G stage. I believe ONLY the French firm Total remains with a few assets left.
As for the move itself, whether this was a good deal for Peyto or not, i would say YES, it was. For a total price tag of ~$600M for Repsol's Canadian unit, Peyto get's about 23K of boepd, mostly NG. Which translates into about ~26K per flowing barrel paid. Which is a more than decent & fair price paid/sold, for both sides. More in Peyot's favor i beleive, considering what Crescent Point & others paid for assets recently.
I'm guessing this was totally paid in cash so it would be interesting to see exactly HOW Peyto go about to fund this purchase, meaning what combination or portion from cash on hand & debt to be borrowed. As Peyto debt was already near $1B last count and it was being gradually reduced with time. So this will be interesting to see how this plays out on this end. But all in all, a good move for Peyto, as it will increase current production by about 25% without going crazy on the Capex front with organic growth.
I think the stock price should respond well, maybe not in the short term but over the longer term it should.
https://finance.yahoo.com/news/peyto-buy-repsols-canada-unit-212648352.html
GLTA
Comment by
mrmomo on Sep 07, 2023 9:21am
Well..........LMAO.........That was FAST..... I guess Peyto "quickly" answered some of my "concerns" reagarding the financing of this purchase from Repsol. Are Peyto mgmt reading this board & my comments?.......seems VERY likely imho.....lol https://finance.yahoo.com/news/peyto-announces-increase-previously-announced-130200571.html
Comment by
PabloLafortune on Sep 07, 2023 9:54am
More or less 10% dilution. Worth it though when you consider the boepd and the big increase in quality locations which was an understated problem for Peyto. The fact Repsol was a motivated seller makes the timing ideal. Underwhelming pricing by the banks though.
Comment by
Ganga22 on Sep 07, 2023 9:57am
Quickly, I do not think so, it was planned. And to all that like price to fall to buy more, please explain this thinking. Makes no sense to me.
Comment by
robert41 on Sep 07, 2023 10:20am
Agree with mr momo really like this for pey. I tried to add to my position buying into the bought deal by the time I sat down clicked on my Td account the deal was closed.