GREY:ROAOF - Post by User
Post by
otrabon Jan 01, 2009 3:15pm
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Post# 15676482
Possible Scenarios
Possible ScenariosFirstly, I suggest you not bash the President. He personally arranged the Can-O-Crap financing; but the board of directors alone cancelled that option negotiated soley by the President.
However, even if Oilexco North Sea did complete that Can-O-Crap financing - - - that alone may not have stopped RBS from demanding repayment of their $652 million loan at any given time following that financing.
Also, one should not confuse Oilexco Inc. with Oilexco North Sea. They are separate entities.
Oilexco Inc. has funds and is not bankrupt.
ONS is the company placed within a "form of bankruptcy" which will allow it to function under "administration". That administrator is required to maintain operations if it is justified; place all or a portion for sale; collect all receivables; and to only pay for ongoing operations if that is justifiable. Determine who all the creditors are, the amounts, and in what order of priority each creditor holds.
It would appear that RBS finally seen the bids that were received through Morgan Stanley - - - and presumably decided that the bids, if accepted, would not repay the existing $652 million loan, let alone repay the agreed upon additional $48 million bridge financing; so immediately ceases all further funding.
Perhaps, Oilexco Inc. may even have a legal right to claim damages from RBS for cancelling the agreed upon arrangement?
The administrator will review all options, and the bids in particular, for the best return possible to all creditors. Perhaps Oilexco Inc., assuming they could arrange some financing, could also bid for the ONS assets?
Within the context of the current credit environment worldwide, the existing bids for ONS assets solicted through Morgan Stanley were likely in the $0.10 to $0.30 cents on the dollar. Why would anyone bid any higher knowing ONS was out of cash, required an additional $250 to 300 million financing; and had only until Jan. 31, 2009 to survive on its' own?
So, is it possible that Oilexco Inc. management was intelligent enough to pursue the ONS administation concept to give themslves some time to put into place their own $0.31 cent on the dollar bid for ONS??
All the above are just thoughts, combined with some wishfull thinking for an easier, fast reorganization plan.
AIMHO
otrab