OTCPK:ATGYF - Post by User
Post by
Bigbadoilon Mar 28, 2012 6:37pm
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Post# 19730579
Greer maybe a loser but....
Greer maybe a loser but.... As far as I see it this is a liquidity event or a division into 2 pure plays..
If you like Argentina, then you are getting 0.19 of a Crown Point share for every AEN share that you own. You can play the Argie Shale oil play with a company solely in Argentina. Otherwise you can cash out your Crown point and get approx 21c per share (based on CPW sp today at $1.12).
A point to note AEN's Sp hasnt really moved much with the deal announcement but there is a simple arbitrage play going forward- it should move up to about $1.20 as we go to remove the arb factor (all things being equal) - (after the deal is approved by AEN shareholders I guess). This deal sort of corobrates the idea that AEN had no value in its SP for Argentina and the SP was based on the North Sea assets. So even if AEN or Crown Point doesnt go up before the deal closes - its a nice 20% or so return. CPW wll be diluted of course but they have the increased production and 100% of the Shale oil block and great management.
So what about the losers at AEN??? Well it is now a pure Brent Oil play with the Causeway production coming later in the year. Yes $120 pure Brent crude. Now I cant predict oil prices but with the whole Iranian thing bubbling along in the background - this is a pretty low risk play on crude going forward.
Bigbadun'