NO TA ON THIS THREAD PLEASE - (edit) and no pointless speculations either!
I've created this thread just to park stuff in that is only tangentially-related to SOCO's interests and doesn't relate to any of the specific assets.
In reply to LongbeardRanger, post #882
what is a little concerning about these noises is that it suggests their focus isn't on outing the value already in the company, when we have all been assuming that that was what they were focussing on.
I think an essential part of outing the value is to continue what they do best - act as an E&P.
They currently are throwing off large sums of cash. They have 3 options:-
- Say the growth game is over and start paying out out as divs (may suit some but I'm out of here)
- Sit and twiddle their thumbs and wait for an offer (not, surely, the way to get the best deal)
- Or go on doing what we, the shareholders, pay them to do and look for productive uses for that cash.
Peter has summarised this well. A number of comments appear to suggest that "new ventures" (which have now been flagged for over a year, BTW) and "monetising assets" are mutually exclusive.....they are not! Equally importantly, they are the responsibility of different people within the company. I'd expect monetisation to be a CEO/FD jod - and I'd expect exploration opportunities to be down to the explo/operations people (such as Antony Maris, who was quoted on the topic).
If people stop looking at what may be ahead of them then they are generally stopping or looking behind them! In the circs, it is 100% right and proper that such opportunities are seriously considered - and, if the terms are right, they may well make sense to do (though that would be a board decision in the circs at the time - which I'd suggest will be after April when everyone is clear re TGD plans).
One should also not forget that there are some substantial opportunities out there, according to the FT's thesis that there are capital constraints on explorers - and SOCO's position (with very strong cashflow in relation to their commitments) makes them probably the best-placed of the FTSE350 companies to take advantage. Whether that will be worth anything only time will tell....
The other factor to bear in mind is that new ventures will, IMO, require a new exec management team to take them through. This is another reason to think that VN monetisation will be accompanied by a "son of SOCO" with new management - if they don't do a lock stock and barrel deal.
ee
