Coming out of retirement.......8).................for ONE LAST hoorah!!!!!
For those that don't know.......i've pretty much "retired" and removed myself from posting on SH any longer. Due to the crazy amount REDiculously insane moderation & censorship. Which of course for a person like myself who likes to speak MY mind & spit out constant truths & facts.........is .....let's just say .....unacceptable to me .......to continue wasting precious time on here & posting informative content for others. SOoooooo..................
So.......when i heard about the Crew buyout last week, a long time cloxsely followed "darling" of mine for close to 20 years"... i just HAD TO come back.....ONE LAST time.... to offer my 2 cents worth about the whole situation. If it's worth something to you, then go ahead my good lad and continue reading on. If you're not interested in the least bit in what have to say about it, well then my friend.......your journey with me stops right here....8).
This won't be TOO long, so don't expect some indepth dissertation or long analysis on this. This is just a straight up opinion of what think about the buyout and IF it was fair to s/h.
First, i start off by saying this. As many of you KNOW me, at least those of you......whether friend or foe....that have been following my commentary on here for the last 5 years, you KNOW my feelings & opinons on this. And so putting that out there, you guys KNOW i've been calling for a buyout of Crew, pushing HARD for one..... for ages now, ever since that time. So what occurred last week with the offer by Tourmaline is NOT a surprise to me .....and it should not be for those here who are knowledgeable (or those following me lol) in this space either.
You guys should have KNOWN "something" was coming. Due to some of the "actions & questionable activities" implemented by Crew mgmt over the last yeat or so. We didn't know WHAT exactly, BUT we know :something" was up and it was only a matter of time. For me the big elephant in the room or the exact inflection point was "Was Dave & Crew READY to sellout.....or not?"
And by the news released last week.....it seems they were. Now the question begs, was this a "FAIR" offer for Crew s/h. Before i answer this, i just want let people know that i sold out, my very modest postion, months before the offer came. I re-entered this again at the beginning of the this year, after selling my 2020 position at a huge profit in 2021. With the intent or objective the some possible M&A for Crew was on the horizon......very soon. So why did i sellout my modest postion a few months before the deed? Easy enough to answer.
The first reason, any M&A for Crew at this point forward was50/50.....at best. With the sticking point being mgmt being hard headed to sellout or accept any decent offer. Two, the VERY low NG prcing environment made things extremely challenging for pure gassers like Crew and with Trump headed ofr a possible second term, it made things VERY bleak for the producers & the sector. And lastly, i didnt really have THAT big of a position and i didn't really expect THAT big of premuim (we'll touch on this a little later lol & NO CR holders did not get a 70% premium lol) IF it happened. And to be really honest, i made (and expected to make!) much more being invested in the crypto sector.......rather than here. EVEN with a buyout.
So was the offer by Tour fair? My honest opinion & assessment? YES.....& NO. It just dependson HOW you look at it and from what perspective. Because you can make two VERY strong arguements that Tour both overpaid & got a helluv a steal....in the same sentence! Right now, you must be all asking yourselves, "How is this possible?". how canthey both overpay & get a deal at the same time? Don't know? Well, please let MrMoMo explain....if you will.
First, by looking at the details & metrics of the deal, if you go on the basis of purely a production assessment, then my dear friends & Tour s/h, then on that premise Tour mgmt "grossly" overpaid for Crew and its assets......by MILES! If we base ourselves on the M&A & deals that have occurred in this sector over the lat few years, 90% of them based strongly on the "production" factor, then Tour "grossly"overpaid by 30% compared to most or the standard deal. At these levels or metrics, Crww got bought out at comparable OIL weighted values, like it was an oil producer. Which is insane to thin about, as Crew is 85% gassy.
So WHY in God's name did Tour do it? Are they stupid? Are they uniformative or ignorant? Why did they spend all the money & overpay for Crew on that basis? Well, let's take a step back and see why. First Tour mgmt are NOT dumb! And its a well managed & oiled operation. So they KNOW wth they are doing or what the assets they buy. You see, yeah sure Tour OVERpaid upfront and at first look. But looks are deceiving & Tour mgmt a sly & are looking at this from a VERY long term perspective. How are they doing this....you ask?
Well, if you completely put the so called prodcution metrics they paid asidefor a minute, AND look ALSO at the neglected & overlooked: "reserves" factor.....then my friends....you get a TOTALLY different picture. And THIS is how Tour just pulled a "Canadian UnNatural" manuover AND got these assets really "dirt" cheap. Like CNRL got the defunct Painted Pony for peanuts. This is HOW you build Canadian UnNatural" type VERY profitable monster operations. And with continued purchases like this,,Tour is on it'sway there also.
So if we BASE ourselveson the reserves factor as well, IMHO, Tour got Crew's assets for a 50% discount....at the VERY least. Or one helluv of a deal.....for the longterm play. I'll be really frank with you guys, i had stated about two years ago that Crew, if we were to take P&P reserves in the equation, Crew would worth at least $12. And this is NO joke. It's all based on solid numbers & facts witin the industry. And NOT a far stretch or exarggeration at all.
So now the question begs, "Did Dale & Crew sell themselves short & cheap"? To answer this properly, you need to know a few things. First, times are tough for the whole Canadian O&G sectors and the future looks dismal.Especially so for the heavily weighted gassers and 10X worse if you're a small potatoe producer like Crew. So to be fair to Crew, Dale & everyone linked to the company.....they were in a very difficult & precarious position. And i had stated that fact many timeson this forum. They needed to either merge or sellout......NO choice. And it seems they chose the latter.
You see folks, as some investors/SH on here were getting discouraged on the "performance" of Crew over the last 2 years or so, some like Upinmuskoka even calling for it to be the next Painted Pony (though he was totally mistaken!) IF things don't change soon.....things were getting desperate all around. Was Crew the Next Painted Pony? No it wasn't........YET. But in a year or two....it was most definitely headed that way IF NG prices remained this low much longer and Crew mgmt remained stubborn. No doubt about that!
So be glad for your sakes, that Dale & Crew finally SAW the light and did the right thing for s/h.Could they have gotten more than ~$7? Sure, if they would have sold in a STRONG market or period and not in a weak one....like they did. But like a said, it was VERY difficult choice to make and would have been screwed either way.
Now, about that premium lol? Did you guys really get 70% premium to market? LOL.....no ofcourseyou did not. Why? Well, you guys have to know, if you don't already, that these deals are worked on months, sometimes years BEFORE they are made public. And imho, this was probably started or put into action.....AT LEAST by the beginning of 2024. so many moons ago, and the arbs & MM& everyone involved "worked" on the stock price and drove to levels THEY WANTED it to be! And therefore make it "look or seem" like you got a huge premium when infact it was alot smaller than it really was.
So what was the REAL premium here? Imo, about 40% from where the stock was"hovering" at or about $5 for ages......BEFORE the VIP players intervened and brought it down for the buyout. Which of course, is in line with most "decen" buyouts. So a resounding NO......you did not get a 70% premium to market lol.................Which should be obvious to most XP'd & knowledgeable investors in this space. Like yours truly......MrMo.
Before i take my leave back into retirment, never to be seen again! I'll just post a few of MrMoMo's greatest hits from the past on this forum, So you can see just how deadly accurate & RIGHT i really was
Take care folks & i wish you all theVERY best in your endeavors....well... most of you anyway lol
GLTA