CANEXUS CORP 6.5 PCT DEBS T.CUS.DB.D

RE:RE:RE:RE:news for nato

[ocean112]

i'm just getting back on this board after a few months off - but man - you're sounding a lot like Kherson.  Bankruptcy?  Seriously?  I take it you didn't read thier latest Q3 report.  Here is an excerpt. 

Effective October 15, 2014, the Credit Facility agreement was amended and restated to provide, among other things, revised financial covenants with relaxation modified and extended through

June 30, 2016.

Thier interest coverage is 4x EBITDA (interest roughly $30M for 2015).   Even if NATO doesn't sell, they have some valuable assets they could easily unload to cut thier debt which is why the banks relaxed thier covenants (not to mention a very stable cash flow from chemicals).

As for production, US Shale production is actually going up in the short term (which is why WTI is falling) - and will likely continue moving up until the middle of 2015 as Shale continues to flood the market.  Canexus plans to close the deal by 2H 2015.

No rational oil analyst is expecting $45 as the new norm for WTI.  Long term prices will stabilize as long as the world continues to drive cars, fly airplanes, heat homes, consume plastics, etc.  Global demand is growing year over year, so I don't presume oil sands is going away anytime soon because of this temporary blip in prices.  Gulf coast refineries will be consuming a lot more heavy oil over the next decade. All the pros have seen oil price volatility like this before and it always recovered - this is nothing new (google T.Boone Pickens for his prediction on oil prices next year). 

No serious bidder is going in with a short term mindset either.  Oil sand investments alone are done with a 10 year mindset.  NATO also is an infrastructure investment with a multi-year time horizon for any serious buyer.  In fact, most "smart money" will likely jump in exactly at this moment, because "smart money" (like  Wilbur Ross), know this is exactly the time to be jumping in - when things are temporarily down.  Also, Canexus was clear bidders span producers, midstreams, refiners, MLPs, etc - not just producers.

Anyway - i'm going back to my little corner - no point debating.  You are entitled to your opinion on Canexus.