Author Topic: EGC - Energy XXI Gulf Coast  (Read 1419 times)

Foreign Tuffett

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Re: EGC - Energy XXI Gulf Coast
« Reply #10 on: September 19, 2018, 07:49:24 AM »
I agree that it's unclear what's going on here. Maybe Cox is struggling to close on financing?

Cox almost certainly carries significant debt already. It bought properties from Chevron in 2015 and Freeport last year. Both those deals were probably large relative to its size.

EGC is also leveraged via huge asset retirement obligations. So anyone who was playing the merger arb game here was probably already skittish and ready to sell at the first sign of problems.

Might be an opportunity for someone with tener cojones. I'll be on the sidelines.


writser

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Re: EGC - Energy XXI Gulf Coast
« Reply #11 on: September 19, 2018, 08:08:55 AM »
Like RSYS, you want no part of a stand alone EGC IMO. Basically a deepwater SD.

I try not to discard companies outright. Everything has its price. On the positive side, Orinoco proposed a transaction in May (and has filed a complaint against EGC for breaching the term sheet) and after that announcement the stock traded higher than it currently does - with oil prices more or less equal afaik. Maybe that proposal is still on the table if the Cox deal fails (then again, maybe not). This might be worth a shot but I have cojones muy pequeno or whatever - my Spanish being awful.
When you are dead, you do not know you are dead. It's only painful and difficult for others. The same applies when you are stupid.

writser

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Re: EGC - Energy XXI Gulf Coast
« Reply #12 on: September 21, 2018, 06:39:03 AM »
Interesting price action for sure. After several ~10% down days today the stock opens up ~20% on what I would say is basically some boilerplate press release without any information. After the open it immediately drops 10% and now back to $7.20. Efficient market ..
When you are dead, you do not know you are dead. It's only painful and difficult for others. The same applies when you are stupid.