WestFire Energy Ltd T.WFE

Interesting approach

[sparky6]

Well this certainly puts WFE in an intermediate spot vs. junior.  Will be interesting to see what it opens up at.  Any thoughts out there on this JV, merger, what would you call it.  Excellent folks on the oip board, hopefully we will utilize their contacts and ability.
spark

[MTPockets1]

This one has me scratching my head – I seem to be doing that a lot these days. The deal was orchestrated by Sprott who had a lot invested in both companies. So what is behind that move? Does this accelerate the possibility of a take out? hmmm.Scotia capital covers this stock and had them as a Sector Outperform and one year target of $11 before this – lets call it a merger. They’ll be providing an

[dmacd]

This was a chance for Sprott to extract value from their tightly held Orion holdings. Both companies are similarly undervalued and remember that neither company had to do this deal. This was a friendly merging of two asset where the sum of the parts is worth more than the whole. OIP made great progress to increase production in the past year and their share price didn't

[MTPockets1]

Great post dmacd. It helps put the recent events in perspectiveIf I could add some thoughts this;The share prices is being impacted by the bigger picture – recent commodity slide has everyone jittery, trading volumes are down (go away in May thing) and this is not the strong season for oil stocks. The market has a lot of information to digest – the latest WFE events and the macro picture. So it

[dmacd]

Thanks MTP. I agree that the Q1 results could have been better, and quite a few others will be impacted since it was not such a great winter season for drilling. OIP must have executed extremely well to achieve what they did over the past year, so it is amazing that WFE was able to snag them for such a low valuation.  There is some profit taking from the sector but with

[retiredcf]

Similar to Scotia Capital, CIBC World Markets wasn't overly impressed with the results and reduced their target from $9.25 to $8.00 (their projected CFPS had been .21) They also considered that while the merger had merit, it was a bit dilutive and costly. Given a couple of these downgrades and the generally lousy markets, I think the SP didn't perform that badly.  

[MTPockets1]

Scotia Capital is on research restriction and I have not seen any comment from them on the results or transaction. Their last target was $11 and based on 1.0 x 2P NAV

[dmacd]

Did CIBC provide any rationale for their opinion? Per the news release, "Transaction is immediately accretive to WestFire on the following measures: 37% on run rate cash flow per share; 43% on current production per share; 50% on reserves per share (proven plus probable); Reduces operating costs by 14% to $13.36 per boe; and Reduces total cash costs by 11% to $16.19 per