MGM Energy Corp MGMCF

Hope i'm not out of line

[SmallBet]

here's what I emailed to both the TSX and Ontario Security Commission. while I understand the risk in the markets of gain/loss, this one doesn't seem right, so I've summarized and sent. probably missed some points too. lets all make sure to make use of our right to vote on this, weather you are for the buyout, or not; "I write to you as an minority investor with MGM Energy Corporation (MGX), with concern on the announced buy-out offer from Paramount Resources, of MGM Energy. I have concerns on how this offer came to market and how this is in the best interest of the minority shareholders. 1. On February 27 2014, a press release from MGM came out; “MGM ENERGY CORP. Announces Completion of Partner Search Process, Potential Proposal to Acquireits Shares and Updated Assessment of Canol Shale Oil Play” in the press release indications mentioned that; “As a result of the Company's inability to obtain a partner to assist it in funding its Canol shale play, the Company has had high level discussions with management of Paramount Resources Ltd. (“Paramount”), which owns 13.9% of MGM Energy's shares, regarding Paramount acquiring the MGM Energy shares not owned by it. Through such discussions, Paramount has indicated to MGM Energy that it is investigating potentially making a proposal to acquire all of the issued and outstanding shares of MGM Energy. However, there are no assurances that any such proposal will be made by Paramount and, if made, Paramount has indicated to MGM that such a proposal is currently expected to be at or below the current trading price of MGM Energy's shares. In addition, Paramount has indicated to the Company that it is supportive of MGM Energy searching for other strategic alternatives and if Paramount were to make a proposal, such proposal would also allow MGM Energy to search for strategic alternatives for a period of time after any definitive agreement was entered into regarding Paramount's acquisition of the Company's shares not owned by it.” 2. Concerns I have are many. Paramount Resources owns 13.9% of MGM. Clay Riddell (CEO of Paramount) owns significant volume of POU 3. Clay Riddell (CEO MGM also) owns 31.6% personally of MGM. 4. This week (Tuesday March 11th) the news comes out; As per the Proposal, all shareholders of MGM Energy would receive one Class A Common Share of Paramount for every 300 common shares of MGM Energy. Based on the current trading price of Paramount common shares on the Toronto Stock Exchange or "TSX" of approximately C$45.00 per share, this represents C$0.15 per MGM Energy common share. 5. Was enough time given by MGM to actually source a Joint Venture partner from time of announcement of search to end? 6. The lack of timely disclosure of results on drilling of 2013 well is unacceptable, to minority share- holders. Minority shareholders to my knowledge have never received any operational update on drilling/flow rates, potential joint venture partners, etc. The filing of significant discovery with National Energy Board was not released by MGM but learned about by independent minority share-holders via their own homework. The trends in lack of disclosure are disturbing to share holders. 7. Based on points 5 & 6, I would question if “material information” was made public at all or in a timely manner. 8. “Nobody in this world seeks to acquire something, at their expense, if they don't perceive value in excess of their expenditure”. With this in mind, market value at the time of offer was not $0.15, it was near $0.20. Since Paramount & Clay Riddell are clearly majority owners, how is it in the “Best interest of the minority share-holder” for him to drive down the value of his own company? The willingness to readily buyback the company at a significant discount indicates to me in my opinion, impropriety... 9. Devloution is official in April 2014. Many in the public assume this is great news for development in the north. So why then the drastic push to push this offer through before devolution, when MGM (by extension Clay Riddell) indicates there are sufficient funds to carry them through to the middle of 2015? In the announcement made Feb 27, MGM already mentioned the potential offer, so discussions/staging of offers clearly could have been going on already. 10. Other major players in the region are currently drilling exploration programs, and investing in the infrastructure showing signs of excitement in the region. So again, why drive your own price down to hurt the minority share holder, PRIOR to any public information on these exploratory wells???? Again, while I’m making no accusations, I have clear doubt on the intensions of this transaction, and how this is in the BEST INTEREST OF THE MINORITY SHARE HOLDERS. I would hope this is at least being considered and reviewed on behalf of all minority share holders."

[richarddye]

This post has been removed in accordance with Community Policy

[scotchontherock]

We have 500 000 acres net both delta and canol.COP paid over 200/acre.Esso paid over 200/acre.Husky paid over 800/acre. in work comitments.that was 3 yrs ago.It will be hard to believe our acreage is only worth 50 mil from POU.That is the first offer.I doubt it will be the last.size of the prize.JMHO.DYODD.

[cochrane29]

Companies are watching and waiting for results on CP horizontal fracking this winter before going forward. Why would anybody step forward with a stronger offer before results are known. 

[scotchontherock]

COP wont be releasing results for 2 yrs.Why did COP pay 200/acre 3 yrs ago?.think they would sell it for 200/acre now?I dont.JMHO.DYODD...

[cochrane29]

People in the business will have the results before then. CP might not release them but the industry will have a good idea how the two fracks went. Nobody has done fracking up there until now. Why submit an offer until the results are known. Or low ball like we see now.

[SmallBet]

Do you really believe these results are needed???  Husky;  doing major infrastructure. Conoco doing multi well program?  Gas reserves are proven. Who knows (other than MGM) what our canol results are because they refuse to disclose, NWT getting more power and wants to develop. What more o you need to know that this is a good risk?  

[cochrane29]

Its all about how commercially viable it is. Dont get me wrong I own strong positions in both MGX and IFR and have been disappointed in the delay of pipeline and latest land sale results. However the majors are busy and if the fracking can hit and see if the Connoco or husky next year move on the results it will be good for IFR and the company that places a bid on MGN energy.

[scotchontherock]

COP no doubt will have the most knowledge in the canol.I hope what they find is good.and raises more interest each and every day.Im going to do the wait and see the proposal and vote with the rest.How soon will that be?Will it be 15 cents/sh or will it be more.JMHO.DYODD

[cochrane29]

Hope there is a break clause. An insurance on the transaction.