RE:CIBC We believe the proceeds could be used to support a substantial issuer bid, fund accelerated development of Gold Creek and Karr, or consolidate a larger position in the Montney.
I disagree with this on a read between-the-lines basis.
The wording used in the special dividend announcement in regards to the Makarov disclosures was oddly specific and targeted. I don't want to say that Makarov's money is in GMT, but I believe it is. First off, there's no way management did a special dividend without GMT's knowledge. As well, I think GMT might have been the ones to propose the special dividend for liquidity purposes. Makarov is sanctioned and has had assets seized as a result. He is hurting and needs cash.
Additionally, GMT has been very carefully dancing around ownership disclosure rules to avoid disclosing UBOs. If Spartan were to do a substantial issuer bid, it would trigger takeover bid rules for GMT unless they pre-emptively dump shares to offset their ownership accretion. Furthermore, the slow process of doing a takeover bid such as GMT isn't allowed to trade 90 days before or during the bid. Takeover bid must also be opened for a minimum of 105 days. The list of reasons go on.
Lastly, Spartan understands all of this which is why (IMO), they specified a focus on dividends over buybacks to avoid the entire logistical mess of a takeover bid.