Tuscany International Drilling Inc T.TID

The DIP facility and the Implications

[perdikaoilgas]

1) A bank does not give one single penny (let alone $35 million) to a company if the ship is sinking. Obviously CS believes or knows or has strong evidence that Tuscany needs some time to rightsize its balance sheet, sell some assets and increase the UT. 

If Tuscany was a lost game, CS would not add more money in a bottomless hole. This is simple. CS would force TID to Chapter 7 and liquidate the company NOW.

2) I also believe that TID will refrain from withdrawing funds from DIP facility of $35 million and/or it will draw the least possible.

3) As shown at todays NR, the long term debt reduced from $205 million in November 2013 to $202 million as of today which is another good sign.

[khaledb]

@perdikaoilgas ...sorry to say this but .... all what you were saying about TID since few months about was completely wrong. 

[RHertig]

 This is true. They can also ask taht for their money the judge wipe all common stock and issue it to them for that money. That doesn't mean the judge will say yes but not only will they fight for money owed greed kicks in and they will try to grab anything they can get their hands on.  It is good for us that Walter owns a major amount of stock and will fight. Some management go

[perdikaoilgas]

I think we all here have to point out that the long term debt has not risen since Maurel deal. It was $205 million and it has dropped down to $202 million as of today. Today's NR talk about $237 million total debt (202 + 35 DIP facility). So the company has NOT withdrawn any money from its lenders during the last 3 months.

[khaledb]

This is because they had 16 milli cash from last quarter + money received from M&P, and also because the decembre debt payment has been delayed to January 24th  ..they spent all the cash and now they have nothing that's why they need  35 milli

[perdikaoilgas]

Having 35 million available at the DIP does not mean that tuscany will withdraw all these funds. 

[dogtoobad]

The extra lifeline only can be drawn upon the approval of the restructuring officer and with the consent by the bank. The management have to demonstrate that the use of fund is absolutely necessary for the maintenance of immediate cash flow or generating new cash flow. That said, this amount has been pre-negotiated, and it could very well be the money they need to maintain survival.