Spartan Delta Corp T.SDE

The Way Ahead?

[retiredcf]

Could we get your view on this deal? Do you favour heading down that path, or would you prefer selling SDE on today's bump? Any other comments regarding this deal?

We think it makes sense for SDE. Investors get a nice payout and the company gets 're-set' to a much smaller company and 'smaller SDE". Logan Energy gets a chance to re-build smaller companies to try and create more value. It only took management four years to grow production and monetize, and it is much easier of course to grow from a smaller base. While there are risks, we would be inclined to let management re-set and try and do this all again. (5iResearch)

[retiredcf]

A few more details. GLTA I gather you recommend to continue to hold onto SDE as a bet on management. What are the assets, production, cash flow, P/E etc. and how much value do you put on the Logan warrants? More info will be forthcoming in the circular so some of this data is not available yet. Logan will have $104M cash and 4,500 b/d of production, with 55,000 acres. SDE will have 40,000 b

[Fyordian]

Logan spin out is already oversubscribed. The price is cheap and the assets are worth more than the $0.35 price tag. Expect a merger with another entity that will be the next in Spartan franchise. Not sure if I should dump SDE for Logan after closing or rebalance it out.

[anticline]

Retiredcf - the Logan spinout will actually have 193,000 acres of Montney lands. The smaller SDE will be a deep basin 40,000 boe/d operation that will be in the old Bellatrix lands if memory serves. Yes BXE a name that gives me heartburn.  In any event I suspect SDE will be able to steward the Deep Basin, which is a prolific producer, in a better way than BXE and allow the Logan enitity to

[PabloLafortune]

Dont get the Logan deal at all. If Logan needs money, just reduce the special dividend by 50 cents and put the $90M in Logan instead. That way, SDE shareholders maintain their ownership in Logan assets instead of potentially being diluted by 70%. Besides, at one point the presentation was tslking up new completion techniques at Simonette which was later removed from the presentation.

[TerribleEng]

Ditto. I like the sale. I like the idea of splitting it off.    But the assets are being stolen. The NPV is largely based on a $60 WTI price that make the assets look worthless except for a couple years production value given to the PDP.    The low NAV allows for the massive dilution as everything is based on a $0.35 valuation. No one would get these assets for $50M in

[Seppelt]

Sell or Hold? Makes no big difference, the deal has been announced, all cards are open and, apart from arbitrage trading, the market will ultimately decide whether the current price is fair. Just give it a few more days or weeks. Holding, among other things, is a bet on a recovery in natural gas prices. I am not sure... record warm January or the entire winter plus Freeport outage did a lot of

[PabloLafortune]

Yeah I mean Crew sold 48,000 acres with 3,000 boepd for $120MM.. This is 4x the acreage similar production and half of a 100MMcf gas plant I believe (the old Cequence asset). Plus they were so enthusiastic about applying new completion techniques to Simonette (i3 is also in there and getting good results apparently) and then poof, disappears from the presentation.   Also goes to show you