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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (36982)	3/16/2010 4:01:55 PM
From: E_K_S	Respond to of 78752

Hi Paul Here is a good article regarding the CNX purchase. Consol in $3.5B gas deal Cecil firm buying 500,000 acres in Marcellus shale post-gazette.com From the article:"...The deal, slated to close by April 30, will add 1.64 million acres to Consol's footprint, with about 500,000 acres in the so-called "fairway of the Marcellus shale," the portion of the natural gas reserve running northeast from central West Virginia through southwestern Pennsylvania. Consol's new total of 750,000 acres in the Marcellus shale should put it in third place behind Range Resources, of Fort Worth, Texas, and Chesapeake Energy, of Oklahoma City, each of which has leased well over a million acres in the Marcellus. The Consol purchase will include more than 9,000 producing wells in Pennsylvania and West Virginia, with net annual production of 41 billion cubic feet...." =============================================================== Consol plans to pay for the deal by issuing between $2 billion and $2.5 billion of new stock, and between $1.5 billion and $2 billion of debt. Therefore, it's possible you will see more pressure on the stock when the new stock comes to market. They may just sell the whole chunk as a private placement. The other hidden jewel in the mix is the NG pipe line that feeds to the Maryland LNG terminal. I do not know if this asset is included in the sale or if D maintains control or maybe D spins it off. I would love to own a piece of that to put in my basket of NG stocks. EKS

To: Paul Senior who wrote (36982)	3/22/2010 1:53:15 PM
From: E_K_S	Read Replies (1) \| Respond to of 78752

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...." ===================================================================== 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