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Strategies & Market Trends : Value Investing
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To: Paul Senior who wrote (36982)3/22/2010 1:53:15 PM
From: E_K_S  Read Replies (1) of 78669
 
RE: CNX Gas Corporation (CXG)
CONSOL Energy Inc. (CNX)

It looks like the play was to buy CXG short term and long term accumulate CNX. CNX will issue $1.75 Billion of new common stock (that's about 40 Million shares a 22% dilution) and $2.75 Billion in senior debt to finance both transactions.

UPDATE 2-CNX Gas shares rise on proposed take out
Mon Mar 22, 2010 10:19am EDT
* Consol to start CNX Gas shares' tender offer by May 5

reuters.com

From the article:"...Shares of CNX Gas surged as much as 24 percent to a new year-high of $38.18 Monday morning, making them one of the top percentage gainers on the New York Stock Exchange...."

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I will accumulate more shares of CNX around $40/share as this price target accounts for the dilution and new debt. It could go lower. Long term it seems like a good way to position the company and complements my other oil and natural resource companies. CNX traded as low as $43/share on the news today on twice the average volume. So it appears that investors are selling into the news and more than likely will continue the sell off as the new shares hit the market.

CNX Gas (CXG) up 23% +$7.06/share to $37.95/share

finance.yahoo.com

EKS
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