RE:RE:RE:RE:RE:RE:Well done Dale & Team.I would take $4.00 cash or equivalent in shares of purchaser, but I find it hard to believe TOU would issue more shares that would only be potentially bought back at a later date, most likely much higher. When they have so much monthly FCF to pay for the buyout my bet is they would pay cash.
Cheadle12 wrote: Well, we just lost around 10% of stock price again today.. currently sitting as the worst performing name on the TSX..
Does everyone still think that a $4 buyout is still unreasonable or would they take that now given the volatility in the markets and the unknowns/sentiment with the variants..
$4 today puts it at a 36% buyout premium.. better than any in the last 4 years.
People often get greedy in bull markets, I'm not. I'm realistic and always have to protect the downside, some risk here for sure.
gonatgasgo wrote: One thing for sure with your plan, is the volatility in this name would decrease. It seems like what is more volatile than the price of nat gas is Crew. The volatility is unbeleivable.
Cheadle12 wrote: Hope I answered the question you asked gonat, .. if I read it a different way, the only other companies I would consider putting growth money into would be:
- Kelt Exploration - large upside, 50% lift in Q4 Production relative to Q3.
- Arc Resources - Good upside, with a growing dividend profile. Generated $500M in FCF in Q3.
In that order. I see either Shell, Tourmaline, possibly CNRL (unlikely), acquiring Crew, Ovintiv is a long shot, very unlikely. The obvious is Shell. Tourmaline are the most positioned to acquire Crew though given their FCF & $400M in debt that they can assume ($1-1.2BN range, sitting only at $800M).
~The Great Cheadle.
Cheadle12 wrote:
Here's what I was thinking Gonat:
TOU acquires Crew at $4 per share (minimum), all stock (no tax - or at least deferred).
That is 23% premium to todays closing share price.
Most banks have TOU with a $60 price, offering a further 36% upside.
TOU also are expected to pay around $4 in special dividends in 2022, which combined with the base is around a 10% yield at $44.
This would mean that Crew would need to climb to around $5.84 to be on par with this return by YE 2022, assuming TOU make it to $60 (many feel they will, net debt free and generate $225M in free cash flow per month). The downside risk of TOU is lower than our Crew. If one of these variants really got out of hand, Crew could be down in the $2's, if not $1's.. and if it were near the debt refinancing due date.. well let's not go down that path!
So weighing it up like that, it's a fair comparison and yes, something I would consider as a shareholder, in the $4-6 stock range as that is an excellent exit for a great company.
~TGC.
gonatgasgo wrote:
Once you get your $4 (before tax and more like low $3s after tax), where do you deploy your money?
Hint: It would have to be a name that will outperform Crew!
Cheadle12 wrote: Sold the Lloyd heavy oil asset.. now WCS has tanked, hard due to a few different reasons...
Great timing.
Now, let's see how Nat Gas does & also Condensate.. C5 is down considerably in the past few days, this more impacts Pipestone & ARX, but less so Crew.
I know there are some folks on here that wouldn't accept $4 / share for Crew.. but there is some variabilty.. I'd be happy with $4-6 a share now, but to each their own.