Well the timing makes sense now. Our Thaiger shark was obviously...

Well the timing makes sense now. Our Thaiger shark was obviously keen to take a punt on the outcome of Bara - success would have resulted in a much bigger pay day than the mere 10m or so profit he takes for his venture in to NDO

There’s not much to find in googling Bangchak Petroleum, but plenty to ponder all the same.
Why Nido? Undervalued yes, but there are many others in this situation. Given BCP’s lack of history in upstream it has something of the feel of a deal done at the golf course rather than after any exhaustive search of the market.

The raising of registered capital is not a big issue. They would have had to start down the path of registering the new company some time ago before this deal was consummated. A 100,000 USD initial registered capital was probably enough to park in the bank in Singapore until a deal was confirmed. With 140m USD, or thereabouts, in cash reserves at March31, the balance is not hard to fund.

It is interesting that they have chosen to base their subsidiary in Singapore. I can’t see it offering them any particular tax advantage (Singapore 17 – 19% vs Thailand at 20%). Why Singapore?

It is safe to say that they didn’t buy it for the dividends. And yet they say it will “support increase of the Company’s revenue, net profit, and stable cash flow in long-term”. That may be true on an equity accounting basis, but they won’t have recourse to any cash unless they take over.
In similar vein, profits & stable cash flow won’t come without making more in producing than is spent in exploring. That may be the long term plan for NDO but, in the short term at least, exploration is a risky but vital part of an oil junior’s growth plans. It is likely to remain that way unless BPC move to a controlling position.

The trading halt suggests the action is bigger than just a 20% block changing hands, but, with no prior experience in upstream, would they want to run this themselves? I would have thought not but the continued TH reinforces the feeling that there is more to come.

I’m not convinced that this is last week’s “in discussions with parties to maximise value for the Company’s shareholders”. I get the feeling there is more to come on another front.