RE:RE:AECO. Is zero
Hey Kav. I don't think who has the term debt matters much. It is open for prepayments next year, I expect it to be paid out early unless another great deal comes along.
I cut and pasted two paragraphs about the CERTUS Acquisition ONLY from two different news releases. The company was worth at least 100 million all day long which is what they paid. They financed just over half of it (last paragraph). Similar to rates paid by BNE, Surge and Gear. Likely falling a bit this year if there are BOC cuts.
They put Net Operating income instead of Cash Flow or Free Funds flow but i expect it refers to cash flow using commodity prices in September. The Acquisistion is paid out in under three years, but they only financed about half of it. Most of the cash flow is from the liquids anyway so it should still pay out quickly even with an 8 month blip of poor gas prices.
Based on September 2023 average production, the Certus assets are expected to generate net operating income6 of approximately $38.4 million in 2024 at strip pricing. (So net income is expected to be 3.25 million per month while financing will cost 1.84 million per month. With lower gas prices it is still extremely accretive. )
The Company concurrently entered into a three-year secured term debt facility provided by a private institutional investor in the amount of $56.27 million to fund a portion of the purchase price. Pine Cliff expects to issue annual guidance in the first quarter of 2024. (so payments of 1.84 million per month).