Afren They got it wrong again

I’ve written a series of blogs now on Afren for a host of different reasons.

One of the main reasons has been some of the most diabolical posting ever on bulletin boards.

They will know who they are, they are folks that came on this morning before 7am saying the Afren SP would drop to 1-2p straight away so folks should just sell and get whatever they can for the shares. They are folks that said that the shares in Afren are now worthless.

They are also the folks who said that the Bondholders would own 100% of the company, or that Afren would be delisted.

They quite simply prey on the fear of investors, by stocking up that fear and coming out with some pretty dire comments. They are simply scum….
The truth is that the SP is now currently higher than the end of Jan, despite everything that has been thrown at it

Anyway now that’s out of the way…

Afren fired the starting gun this morning, first offer out of the blocks is for current shareholders to maintain around 10-11% of the company(for a company that fell 95% due to fears it might go bankrupt that’s a reasonable achievement). The Market obviously priced in a larger fall. Also obviously the market had priced in this news to keep the SP at around 6p, it looks like as I type the SP is around 4.85p due mainly to the selling out of PI’s, but who do we think is buying the shares….

The offer is stupidly low and for a number of reasons I certainly wouldn’t and won’t be voting for it.


So the negative points.

Why pay now and convert now for debt not due until 2019 or 2020 ? This makes no sense, by 2019-2020 the company will be much stronger. Why this pigs ear of a very complicated set up, whereby we /Afren borrow money from the bondholders to pay back the bondholders? The cost cutting is due to create a pathetic reduction in total spend. It needs to go much further….Why no disposal of none core assets? Are any of the current BOD going to see a wage reduction or will we find them loading up on cheap share options? (IMHO they should be banned from any share options below last nights SP). The RNS has obviously been worded to paint the worst possible picture of Afren. The BOD want to keep their jobs and this will ensure that..They should be sacked as soon as possible. Finally many of the bond holders have brought the bonds at sub issue price (i.e at 40-50% of the $) yet they get 100% of the bond value…there should be at least a nominal haircut for the bondholders.

Now the positives.

We have bondholders who are prepared to invest hundreds of millions into the company. This is now the low ball offer, we have security that a delisting will not occur, we also know that the lowest the SP will likely go to is around 5-6p in the medium term (nice feeling for me as 6p is the point where I start to lose money in Afren this year). The bondholders always had to make the first move, now that is done the very vocal bidders can come in and put offers to the table. The bank has agreed in principle to a considerable extension to the RCF, this will be good news for any potential bidders.


My final points are vote NO to the bondholders, we need to tell them to go and bully somebody else.
Sack the current BOD, ask the BOD to suspend ALL discussion with any group involving JP Morgan.
Ignore the cretins who keep saying 1p or 2p, its so not going to happen....
Keep a note of the names of the BB idiots, they are same folks who pump shares, the same folks that talk down all the shares and the same folks that feel its right to sell a car without breaks to a single mum and her family....


Enjoy...Relax...and finally now wait, remember if the BH's are prepared to invest money and loan the company money to pay back to themselves then other folks would be more than happy to do this. Also remember the BH's are not Oil Company investors, they simply want to take the shares, let the SP rise 100% or so and then sell as quickly as possible..


BTW Sorry but I will be removing ALL replies to this post. Normally I am happy to allow free opinions, but I know this simply won't happen on this blog post..