The following is an excerpt from Canaccord Genuity’s Morning Coffee report.
As reported in the Globe and mail, it appears that activist investor Carl Icahn controls about 55.1 million of his 61.5 million
Talisman Energy Inc. (
TSX: T.TLM,
Stock Forum) shares through call options.
According to SEC documents, the options position gives Icahn the right to buy the 55.1 million shares. Therefore, he only owns up to 6.4 million shares, or 0.6% of 5.97% stake outright.
After he announced his stake, Icahn tweeted that he “may have conversations” with TLM management regarding board seats and strategic alternatives.
Icahn’s announcement fit perfectly into Canaccord Genuity Energy Analyst Phil Skolnick’s catalyst driven thesis on the company.
In a note to clients, Skolnick noted that he sees TLM as
Nexen Part 11 and the last of the senior Canadian names that can be acquired by a state-owned enterprise.
[Readers please note that Nexen was a Canadian oil and gas company, based on Calgary that became a wholly-owned subsidiary of Beijing-based
CNOOC Ltd. (
NYSE: CEO,
Stock Forum) on February 25, 2013.]
First, there was management change in September 2012.
Then earlier this year, there were three new board seats added, two of which were notably filled by Brian Levitt, the Chairman of the
Toronto-Dominon Bank (
TSX: T.TD,
Stock Forum) and Thomas Ebbern a former well-respected sell-side analyst and senior energy investment banker and current CFO of North West Upgrading.
Skolnick still believes that by opening up data rooms across the globe, TLM is essentially putting itself up for sale (and Mr. Ichan can expedite this outcome).
On that note, Skolnick is also of the view that a “for sale” sign was put up, whether intentionally or not, when President & CEO Hal Kvisle stated of the March 6 Investor Day that TLM is worth $17-$25 a share.
He also points out that Kvisle acknowledged in May that he is only a temporary CEO, which also has positive implications from a corporate sale perspective, in our view.