RE:RE:Ranger Q4 Earnings Release - March 8Why does there need to be a premium? Both sides must be happy that the deal reached is fair.
Juniper Capital Advisors control 54% of Ranger stock. The US$13.31 cash part of this deal might have been exactly what Juniper was looking for. Why does Juniper want to reduce their Ranger position? I don't know and I don't care. Maybe they had a green revelation and need to reduce their oil and gas exposure. Sometimes the cash portion of an offer is more important than anything else. Good on BTE for being in the right place at the right time with cash and financing available to buy these quality assets at a good price.
Do you think three out of five of Canada's biggest banks would be financing this deal if they thought BTE was looking to buy a dumpster fire? Probably not.
Ranger's upcoming Q4 and year end results this week are going to show what all of the insiders already know. Long term, this is going to be a great deal for BTE.
This deal will help split cash flow between two different geographical areas. This deal does not increase risk, it reduces risk. No more WCS differential worries. No more cross border pipeline worries. No more worries about what anti-oil policies the Liberal / NDP coalition will dream up next.
This deal reduces BTE's WTI break even point. That means if WTI goes down, BTE will be in better shape with these new assets than without them. The deal is based on a conservative $75 WTI. If you are worried about a recession or WTI going lower than $75, sell or reduce your oil and gas stocks and wait for a better buying opportunity.