Gear Energy Ltd T.GXE

Gear and NewCo

[lovehockey]

So this is the breakdown from what I understand.

The purchaser (I think it could be Tourmaline) is buying half of the shares of the company for $80 mln. that is 263 milion sghares divided by 2. With that they get approximately 67% of production.

NewCo gets the rest of production but also 30 million in cash from the purcchaser.

Now if the vote is no obviously nothing will change, however, if the vote is yes then there are some interesting scenarios.

If 50% of shareholders decide to cash in. then they get their $80 million, the other half will receive approximately 3 shares per GXE shares owned. Looks to me that there will only be 40 million shares of NewCo.

If 75% of shareholders decide to cash in - they will only be able to cash in 66.000 shares per 100,000 shares owned and the other 33,000 will turn into about 10,000 shares of NewCo

if 100% of shareholders decide to cash in then they will be getting cash for 50,000 shares per each 100k shares owned and about 15 k shares of NewCo.

What do we know about NewCo

1,700 boed prodcution and 30 million dollars in cash + plus access to some additional borrowing.

[scienceguy36]

That sounds much better than what i gleamed from the news release. I may even buy back in after the deal goes thru. Will be watching this closely.

[constructionsite]

Which part do you think is "better than what [you] gleamed"? No matter whether you receive cash or shares or a combination of both, the deal values GXE, i.e. your current shares, at $0.607.  That's all. For those SH who thought their investment was worth more than this, it's a pretty bad deal.

[lovehockey]

With divs considered, let's make it more right - you will get $0.612 per share. For people who were buying below 58 cents it is a great deal, for others, not so much, you are right.  However the real gamble is in NewCo. At this point there is simply not enough information on it, which will come out before the vote. 

[kavern23]

Dude..no offense but this is why these forums are a joke...you think it is tourmaline? HHAHAH why on earth would you even guess TOU? Is that an april fools joke? Any deals in patch are going to be for long term strategic reasons.   The buyer is likely to be cenovus who has been discretely selling non core central alberta assets as their core is not central alberta NG. Outside chance

[lovehockey]

Does it matter? Tourmalline just wants to swallow any additional production that is available. That was just a guess, relax.