Valeura Energy (TSX: VLE): C$10 mm financing
• Valeura is raising C$10 mm through a bought deal priced at C$2.54 per share.• While the additional cash was arguably not required, we understand that the board of Valeura decided to accept the bought deal to provide an additional cash buffer in the interim period prior to the closing of the acquisition of the Mubadala asset and prior to first oil at Wassana (both in 1Q23).
• It took over a year to sign the SPA with Mubadala for the Thai assets, which was much longer than initially anticipated.
• The dilution associated with the C$10 mm equity issue is very small in the context of the company’s ~C$220 mm market cap.
• We re-iterate our target price of C$4.70 per share as the impact of the new equity issue is more than offset by the rolling forward by one year of our DCF to YE23.
• The shares continue to offer deep value, production and cashflow growth and reserves upside.
YE23 net cash > market cap
Our Core NAV for the company based on its 2P reserves is now ~C$4.50/sh. Including Rossukon, this increases to ~C$4.75/sh. Our net cash forecast at YE23 is now ~US$220 mm (versus market cap of ~US$165 mm) increasing to ~US$380 mm at YE24. The magnitude of future cash generation creates the opportunity for potential shareholder distributions.
Valeura Energy is engaged in the exploration, development and production of petroleum and natural gas in Turkey and Western Canada. As of Dec 31 2010, proven gross reserves for light and medium oil was 116 thousand barrels (net reserves of 104 thousand barrels); proven gross reserves for heavy oil was 10 thousand barrels (net reserves of 9 thousand barrels); proven gross reserves for natural gas was 1,047 million cubic feet (net reserves of 938 million cubic feet); and proven gross reserves for natural gas liquids was 26 thousand barrels (net reserves of 19 thousand barrels).
Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector.
The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy.
Auctus has been set up at the beginning of a new decade in which we see significant opportunities in the Energy space. Globally, demand for energy is at record levels and continues to grow. Conversely, investment in traditional energy sources has been severely constrained. We believe this imbalance creates opportunities for both companies and investors.
Auctus provides Corporate Broking, Equity Research and Investment Banking services.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.