Friede Goldman Halter (FGH) Message Board

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Gold/Mining/Energy : Friede Goldman Halter (FGH)

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To: The Gambler who wrote (2)	11/6/1999 4:43:00 PM
From: BigBull	Read Replies (2) of 177

Hi Gambler, FGH has been my worst performer as well. The stock is looking real wash out here, and some upside volume has been coming in the past few days. It's over 10 right? <g> Also, remember Gary Burtons wave count? 8.5 right? Well 8.75 (52 week low) is good enough for New York IMO. Congratulations Gary. (I bow, genuflect, and prostrate myself before his mighty waves) <VBG> Also BOTH companies were valued in the forties at the last cycle. If the stock goes to 13 or above the down trend will have been broken. My bet is that if you see 13 the bottoms in. I believe it will attain such lofty heights in the next few months. One of the big criticisms of FGI was that it needed HLX more than vice versa, and that therefore the deal wouldn't go through. Well the deal is done. Finished. Signed sealed and delivered. You may remember that many felt as though HLX had turned the corner (re profitability). Inclusion of HLX backlog and revenue will be a plus in the long term and maybe in the short term as well depending on when the double hull conversion contracts come in. The congress has budgeted an increase in defense spending (it's about time) that should also help out as Trent Lott likes to throw business HLX way. Another criticism was accounting irregularities/fraud. This seems to have vanished with the merger. The two company's accounting practices seem to have passed muster with the regulators and accountants. Nothing fraudulent was found. On the FGI side, both bulls and bears seem to acknowledge that the new company will recieve a good bit of refit/refurbish business as more rigs and vessels are put to work in GOM and Brazil. I hasten to add that this is the high margin stuff. Also, Holloway has said the company intends to enter the FSPO market. My bet is that the FGI engineers can design them, and the yard crews can build them. An added plus is that HLX and FGI will no longer have to compete. There are still many questions: 1. Can they integrate the yards and workforces? 2. Will they get MARAD financing? 3. How will the new company stack up against Korean yards? 4. When will new deep water rigs need to be built? 5. Will the shorts be forced to cover and when? And so forth. Subjects for further discussion eh? I'm sure I missed something. IMO the worst is over. Nothing like damning with faint praise eh? Due to very large short position I expect a volatile ride. Good for selling options?

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