couple thoughts on this. this is easily the most favorable...

couple thoughts on this. this is easily the most favorable special sits risk/reward in small cap Oz equities at the moment. the main impediment to extracting value, before STAM made their bid, was the very real risk that this shambolic board would continue to destroy value through endless, wasteful drilling. that risk is now basically neutered (given the STAM bid; willingness and ability to start a liquidation of the co; and the co's response to hire an advisor and consider all options, basically tantamount to surrender).

at this point it simply becomes, what path is going to be followed to maximize shareholder value. as you can see, already a good chunk of the register has moved into activist/pro-liquidation hands. Obvi STAM at 5%, but another 6mm shares have traded since the STAM bid (ie 6% of the company) - all of those are votes to effectively liquidate the company (if the matter was put to a vote which it may well be).

the valuation argument is straightforward. total value here is at least $1.1, as others have commented, the Woodside earn-out is basically in the money and could easily be hedged using the futures curve (i could do this in my brokerage account, it is not difficult). everything other than the cash balance and woodside earn out is gravy, with huge optionality. Petronas may wanna pick up 50% of the Gambia licence for $10-20mm - small beer for them but a huge excess return for FAR. all it requires is a complicit board forced to put up the 'for sale' sign and we are basically halfway home.

i expect the stock to retract to the mid-70s fairly rapidly, and then see the emergence of other parties - strategics, activists, etc - to drive the board to maximize value and give up anything other than a wind-up scenario.

with net cash on balance sheet of mid 50cs a share, this is essentially a derisked proposition. my only disappointment is this is not liquid enough to throw more than low 8 figures at it.

DYODD. GLTA.