Of course the bet is ridiculous. Doesn't suit anyone other than those short OAS (and there are plenty of them with over 31% of the float short - are you short?) suggesting they may be at risk of a "liquidity event". It suits the post to which it responds
That list is by no means exhaustive or all inclusive. And of course SSN is not on the list. It can't be on the list. AFAIK there is (only?) one reason which prevents it - and I'll let you tell us that.
Let me see if I understand correctly, the option actions you suggest SSN take after the deal....
1. Renegotiate Debt.
By that you could only mean renegotiate new sources of debt. MOB and SSN are renegotiating now to see if they will fund the acquisition and what terms apply. I did highlight the possibility that MOB might want to see part of the BB termed out - which might require some 2nd lien debt, a mezzanine lender or even a convertible note. That is unlikely to be a good thing.
2. Capital Raising
I did ask Buc that one. The thought was the deal might juice the SP as the EV is increased and (suggested) pro-forma does improve the company overall. Thus they would be raising capital at a higher share price. The placement option (is it 25%?) for SSN is always available. Would retail holders participate? Doesn't sound like it though from what I've read in the forum.
3. Refrac wells
Yes. That is the plan isn't it. I was working on that assumption in the proforma spreadsheet which is why I suggested MOB beefs it by $19M to ensure SSN does not run out of cash to pull it off.
It would be a whole new company IMHO also - the proforma clearly illustrates that.
Would you agree?
SSN Price at posting:
0.4¢ Sentiment: None Disclosure: Not Held
