RE:RE:RE:absolute steal by Peyto with the Repsol takeout You would have to adjust for the discount rate - they used 5% which was a bit low on the Repsol deal.
then adjust for decline rates. YGR has dropped it a little, but Repsol was at 12% where Yangarra is probably 27-30% well down from close to 40% to whatever it is now.
Then add facilities and deduct ARO. Because YGR would have better ARO.
probably some tax pools at Repsol. YGR is near taxable.
Then the synergies that would make it such a logical fit for a merger.
Peyto actually PAID an amount equal to PDP - how they got there was probably a bit more convoluted.
YGR needs to improve completions ( assuming it was an issue!) or prove up some more acreage to get that type of valuation.
Then there is the OFS group. Most companies over capitalize the ground with pipelines etc. but run an extremely lean company in terms of staff. Many companies would not even be equipped to manage the group without adding staff. It is relatively unique to YGR right now.
Is it an asset or a liability? It clearly keeps costs down but would an acquirer want to keep it?
I think YGR is worth 4.00 right now but there are a lot of other companies to own that are also cheap with more predictable results or more extensive land inventory.
ideally they would get their act together and start consolidating other operators that they can extend the OFS group to. As a takeover candidate I don't see how you get top dollar.