evolution of africa oil corp... mark ii, page-5

Hey Dhon,

Been looking into the Takeovers activities you brought up.

Interesting to find that Tullow rejected an offer by CNOOC for a 20% interest in the Kenyan blocks :)

Whilst a Super Major attempt to take over Tullow or Africa Oil would sure spark some activity in regard to Swala holdings, further investigations along with Tullow's statement of not letting any go make you wonder how anyone would get a position cheaply and relatively easy of Tullow or Africa Oil.

This begs the question:

So how would Swala stand up against such a takeover attempt?

Well, we've seen some very tidy volumes over the last 2 weeks.
We've seen Icebergs, in my opinion designed to halt the rise. (thinking they get pulled or smashed) - Yesterdays one did is job, but on very very low comparative volume gained so hardly successful in its goal.

We have limited shares available. So someone building a stake early would make sense.
Seismic started, with progressive reporting announced, CPR's due by end of year (5 basins in Tanzania and 12B in Kenya after MT survey with an estimate of Billions barrels already public knowledge).

Noting that that is only a few months away, doesn't leave a long time to build a strategic position, but also noting just over 50% of shares are in escrow we are probably safe...

But are we...

So thinking that at the end of 2013 we have some decent reserve estimates in, Drill target(s) identified, someone maybe building a stake, and our low shares on issue and our belief that Swala is hugely undervalued....

Now jump forward 2 months from end of 2013 we get to February 2014 which is when 15 million shares come off escrow (we've traded that amount over last few weeks), which now swings the available shares just over 50%......and has the potential to open us up.

Given a stake could be being accumulated now, cheaply....its not a long time to wait, (whilst work is being done), to achieve controlling interest shortly after/on/around February 2014.

Further regional successes and confirmation of further licenses would only make Swala even more attractive....and cheaper as each day goes by.

I am not saying this is happening....but I sure think it is a possibility.

Why try taking Tullow or Africa Oil.....when you could get Swala for .5%, 1% or 2% of what you might pay for a Tullow or Africa Oil attempt.....(which might fail)

Makes your $100 million estimate look cheap at only 3 times current MC?

Obtaining a decent stake in Swala will push up the price for sure. (speculate) So say a real stake push attempt, pushed the price to .50cents, and a MC of ~$60 million before escrow comes off, when a true push can begin (for only what you need)....gaining the required amount to top up a controlling interest may increase price to "say" $1.00/$2.00 (on thin trading)....but you only need another 5-10-15-20% for a controlling interest....

MC up, your (your = the buyer) cost in acquiring a controlling interest hugely discounted :) given other options to relative exposure to the EARS.

All purely subjective and speculative "what IFs".
Something to ponder...Good thing is, holders benefit either way at these prices.

Be interested to hear your and others thoughts on this.