RE:RE:RE:RE:RE:Time to buy ?????
I wonder what the Trinidad Board is thinking. Granted, I am only seeing the negative ...regardless of the 'glowing' assertions in the press release. Although, I have a funny feeling I know what is happening here....
If I have this deal right.....Trinidad wipes out up to 75% of their cash while diluting the share value. This is a 1/2 Billion $ deal.... from the looks of it, with the Trinidad cap value paying the price. Adding 50 Million Canelson debt to 600 million? Talk about kicking the shareholder in the teeth. Great move .....very strategic.
The bottom on this deal for Trinidad stock holders is still to come....I doubt a 10% drop today is anywhere near where this is going to settle.
For those holding Canelson, great opportunity for you. Take the money and run. Buy back Trinadad at nice discount in the future.
I disagree with some comments. I honestly can't image why Canelson stock holders would turn this deal down. Canelson would not have survived much longer in my opinion given their deep revenue drops in drilling or transport activity. In trouble... their Board had no option but to shop the company.
IT isn't as if Trinidad has survived the oil patch 'slaughter' either......the stock value is down 60% and net income is down 50%...... in one year. So again I ask...why would Trinidad go out an wipe out most of their cash and r intrinsic share value based on a stable balance sheet ?
This deal might have made some sense if the oil price showed some stability and there was some prospect of a secure future price or some increases drilling bookng but there is nothing resembling that happening for the next 6 months.
Why do I think thiis is not over yet?? I wonder what will happen to the Trinidad dividend rate next quarter knowing that Canelson is paying 3%....40% less than Trinidad. Easy way for the Trinidad Board to clean up and stablize the Balance sheet next quarter....you think?
Canelson had no other option given the present market and oil price. So...my best guess is Haliburton is now calling the shots at Trinidad and this deal is part of their 'strategic' alliance.
I hold a huge hunk of TDG at this time. I stuck with them knowing that they had a great chance of surviving given a good balance sheet.....regardless of stock price drop. Now? I wish I had dumped them last October when I sold my Canelson.
Note to Haliburton! Buy out Trinidad and give me an opportunity.....offer.... as good as Canelson shareholders got today.
TDG? ...too bad ...so sad.