Valuation I know that for us long-term holders the deal is not what we may have hoped for but in this market it would seem to be ok. We don´t know how long oil will remain low so I think that the dilution to finance exploration and development would have been very high. I like Maersk as a partner. AOI receives 1.122 billion in cash and funding, which translates into 2.42 a share.
Benefits:
1. 1.122 Billion in cash value in a very difficult environment.
2. Further diulton avoided. To raise that amount at 1.70 would require an issuance of 700M+ shares.
3. Retain 25% and AOI carried to production.
4. Allows AOI to pursue other opportunities in a weak oil environment.
5. Another deep pocketed investor to continue development and exploration.
This deal gives me the needed confidence to keep accumulating at these levels as I see the current value of AOI now at around $5, with exploration upside and a high probability of production with two partners like Tullow und Maersk.