Longford Energy Inc V.LFD

LFD / VST Merger - Thoughts

[ngobe]

I am a VST shareholder and was looking to purchase some LFD shares.  As for the merger and sell-off I personally would not be happy (and I think many VST shareholders will agree) with the merger as that would dilute any potential for VST rise in share price while they are in middle of drilling.  That said if that were to happen (and I do not think either side would be happy for their own reasons) it would most likely be done based on fully diluted market cap (not share price) - i.e., currently VST 232 m diluted x .0.69 = $160 marketcap vs. LFD 225 m diluted (211 + 8 m shares and 4 m warrants from April 14 PP) x 0.23 = $52 marketcap. That would be in the ratio of 160 / 52 = 3.07:1 or roughly 3:1. 

LFD share price has been unusually stable for some time.  In addition, recent share price drop in VST despite their drilling entering the deeper and likely the more prospective layers and in addition the quick share price suppression despite the oil discovery by KNOC just above their block suggests to me an obvious price manipulation to keep the VST share price down.  This may be to create an artificial price stability in both stocks LFD and VST stocks to prepare for a smoother transition / merger / share conversion.

I will post a similar message on the VST board.  Looking forward to your thoughtful reactions.

GLTA

[ngobe]

Hi SwissTime.  I am not suggesting that it would be fair at all.  LFD investors are there for a different reason than VST investors are in their stock.  I am just suggesting that looking at the share prices and how they are not behaving rationally both stocks are likely being manipulated to a nice round ratio of 3:1 - knowing that the stated intention of the management is the

[ngobe]

I also wanted to add a possibe take on management's point of view on this subject.  There are a few issues. One is whether the merger should occur.  I have not understood why they want the merger to occur (may be for operational reasons, also strategic corporate structuring for future plans including takeover, etc.).  In any case they have stated it publicly so we have

[ngobe]

I fully agree with you.  Do you know if such a decision would require shareholder voting / approval?Regards

[ngobe]

BNN interview with the CEO (Ahmed Said). Watch for the merger intention announcement at about 4:50 time https://watch.bnn.ca/commodities/june-2010/commodities-june-30-2010/#clip320260 It says in about 4 months but I believe it may be sooner i.e., as early as next week. I recently talke to the IR and he mentioned the merger is in the plans as stated but did not know when. Always do your own DD.

[FXi7]

Personally, I would rather be no buy out and let this lfd slowly get to it's 1st drill.Fx.

[sumeroil]

same here!!!