Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.

Gulf Keystone determined not to go the way of Afren

By Ben Turney

31 March 2015 06:12

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Gulf Keystone’s (GKP) board might not be popular among shareholders at the moment, but it’s been left with little choice. The likely trigger of the Book Equity Ratio (“BER”) Put Option, when the company announces its next set of results, is a looming disaster for the company. If activated, Gulf will be required to make an offer to repurchase all of its $250million 13% Notes, issued last April, for $252.5million plus accrued and unpaid interest, at around the end of September. Given that Gulf had cash of $86.3million prior to this morning’s placement, and appears to be burning about $4million a month, shareholders were facing an Afren’esque (AFR) wipeout. After this morning’s actions, at least there is a glimmer of hope.

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Comments

wildrides

1 April 2015, 05:27

Why an earth would anyone choose to put good money in here , knowing what we know . If you give me your money I will burn it in the incinerator in my backgarden for a small fee ( say 5%) and you can cut out the middle man . Or just put it in a safe country with news coming soon . LGO in Trini fits the bill ………… at the bottom of its range , unwound from last year and first drill news of 2015 coming soon ……… of eight wells being drilled in 2015 .