Finallythere, Endeavour International (END), Ithaca Energy (IAE.V) -- As indicated by the post to which you replied, I once had a position in Ithaca but had given up on it by last month (actually I still own a tiny amount of it but the position is so small it might as well be zero).
But taking a fresh look at the company I see why END is willing to pay $3.25/share for it. They are only producing 1,800 bopd as of right now but are planning to put a new field online in 4Q that should get them to 10,000 bopd. This proposed takeover of Ithaca, since it is (at least presently) a hostile one, is likely to take until the end of the year to get done (if it happens at all). So the timing to intitiate the takeover attempt is perfect IMO --- the transaction would basically immediately more than double END's production, once it closed.
Hostile takeovers are long shots, I would give the chances of this thing going off about the same odds as the chances of a North Sea exploration well making a discovery (say 1 in 4?). That being said, the investors in the London AIM market seem to be taking this offer very seriously, and have bid up the price of Ithaca stock by > 30% so far today, see londonstockexchange.com .
In any event I believe the deal is worth taking a shot on, given the huge upside. Blow $5 M in legal & professional fees for a long shot at being able to buy a company for $325 M that is expecting to generate $232 M in operating cash flow next year (slide 18 of the latest presentation on Ithaca's web site), plus has huge upside from its other prospects. |
