CKE's Craft Oil subsidiary becomes Debt-Free too After today's news, CKE's subsidiary (Tournament Exploration and now Craft Oil) becomes debt-free too!
Including the tradeable debentures of CAD$4.5 million from the NON-core asset sale, Craft Oil will eliminate the small net debt of CAD$6 million and will be a natural gas weighted producer in Alberta with almost Zero debt, while gas price is above US$3/mmbtu! Perfect timing.
My research says that these non-core assets had a lot of ARO liabilbities and this is why Craft sold them at this price.
Now thanks to this debt-free balance sheet, Craft Oil could be acquired with a very good premium by the neighboring producers in Grand Prairie.
And if the suitor is publicly-traded (which is very likely because most of the Grand Prairie producers are publicly-traded), Craft will become a publicly-traded firm very quickly. I bet we will not need to wait by the second half of 2017 for an IPO.
Craft Oil will also have its website ready after the sale of its non-core assets. So the website will be up in November, mark my words.