RE:Headwater Exploration Inc.Kherson wrote: Headwater released their 3rd Quarter results on November 3rd. The following quotes along with the recent unusal trading activity has me thinking that we are gonna be involved in a merger...
- As at September 30, 2022, Headwater had adjusted working capital (1) of $118.0 million, working capital of $113.4 million and no outstanding bank debt.
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Credit Facility
Headwater has executed a commitment letter for a credit facility in the amount of $100 million with a senior lender. With the 2023 guidance as outlined, Headwater does not intend to draw on the credit facility.
Kherson
I posted about a week ago my belief that Headwater is interested in acquiring Cardinal. One of the things that I forgot to mention is the huge tax pool that Cardinal has which is very valuable to Headwater going forward plus the fact that Headwater has recently drilled a few dusters, thereby reducing their viable exploration acreage by about 25%, according to Nuttall.
What is also very interesting is that Cardinal is gonna spend most of their 2023 drilling budget on their Clearwater assets.
Let's say for argument's sake that I am right, what would be the takeout price? Since Headwater will be paying a 10 cent per quarter dividend starting January 16th, I see 2 HWX shares for every one of our CJ shares.
Kherson