The short position continues to increase whilst the share price is declines. Indeed the desire to short seems to be reaching a frenetic level consistent with a cohort actively trying to keep a lid on the share price.
A reformulation of the Mitsubishi agreement to allow monies set aside for development purposes to instead be used in the exploration program (Ungani/Acacia), along with the farm-in dollars would give Buru much room for manoeuvring in the deals arena. I hope that they are having such discussions.
If they do manage to bring in further cash, they could also issue Bonus options (maybe 1 for 7) to shareholders, exercisable in say 12 months time at a strike price of say $2.40. This would give the shorters something to think about. Buru would have 12 months to make another oil discovery and bring Ungani into production, the options would upon success be exercised and raise circa $220 million, which should keep them going for a while and maintain shareholder happiness.
The shorters, of course, would not receive bonus options because they only have the shares on loan. Maybe they would need to arrange off-market transfers to reconcile their bonus allocations to reflect the true number of shares each member of a cartel has on their books. That's if there is a cartel of course.
In my opinion, if Buru want to eradicate the shorters, this mechanism, or something similar (non-renounceable rights issue?) is the only course of action. It is my strong feeling that Buru will have let me down if they allow this rank predatory behaviour to continue without some attempt to halt it. Furthermore, if the ultimate outcome of this activity leads to a Scheme of Arrangement then I will have to say I've lost my faith in the decency of man, or at the very least some men.
Just my thoughts. I welcome any opposing viewpoint as I have no direct knowledge of any of this. I'm working on my own observations of public data. So I would be grateful for any contribution from anyone familiar with corporate/banking shenanigans.
Btw. Here's a left field contender for predator: Noble Group. HQ in Hong Kong I believe.
Sorry: I meant "brief for ME" :)
BRU Price at posting:
$2.46 Sentiment: None Disclosure: Held
