Regal Partners Ltd V.RPL

Sharpe's Advantage Assets Sale

[InvestorSuperfan]

Stephen Sharpe (one of the three guys on RPL's new problem-solving team) closed a deal on one of his poorly performing companies yesterday (Advantage Energy - he is the Chariman). The sale was to Questfire and included almost all of Advantage's "non-core assets" for $40.2 million cash, a $32.6 million Convertible Senior Secured Questfire Debenture (the "Questfire Debenture") and 1.5 million Class B Shares of Questfire (the "Class B Shares"). The net cash proceeds from this transaction will be used to reduce outstanding bank indebtedness. The market responded today by shaving 3.76% off Advantage's share price, closing at $3.84 per share. I have a hunch that all of RPL's Slave Point assets and Viking assets will be sold once "the plan" is revealed - I don't expect RPL to get fair market value for them - after all, it's a buyer's market and those companies with cash know RPL must be desperate to sell if they are bringing in financial advisors and people like Sharpe. If these non-core assets have to be sold, then sell them (though I wish they didn't have to part with the Viking assets at low prices). If the dividend has to be cut in half or eliminated, then do it. Let the market continue to pound Renegade. I think the best way forward is to attain financial stability by paying off debt and developing the valuable SE Saskatechwan assets (provided management doesn't make more mis-steps), the SE Sask assets can be ramped up in the second half of this year, revenue can hopefully start to flow at a good rate, and the market will eventually recognize it. Alternatively, I'd be happy with an outright sale of the entire company at this point if it could fetch $2.25 per share or more - don't know if this is wishful thinking, but given the secrecy, who knows how this is going to play out......?