RE:My Take Part 1
retiredengexec wrote: I looked at Proforma FCF of the combined entity with 340 thousand boepd. 200 gas, 100 oil and condy and 40 Ngl. Using cdn prices of 70 for condy, 350 for gas and 18 for ngls we get FCF of 1519 million with 805 from VII and 714 from ARX. This works out a ratio of 1.13 in favour of VII. since I dont know at which time and price the deal was struck it shows the deal is reasonable. That said I would have preferred using the value of 2P reserves. I think HP said that CPPIB owned about 16 percent of each it is obvious they saw ARX as the better co.
330 million shares outstanding for vii and ARX is 350 million so which is about 5% difference so would the extra 11% extra vii got not actually be 6% in terms of evaluation?