The dissident shareholder of Petroceltic International that has launched a cut-price takeover bid says its banks have offered the exploration company's debts of more than $200 million for sale at discounts of up to 70 per cent.
Angelo Moskov, founder of Swiss fund Worldview Capital who has bitterly clashed with Petroceltic for over a year, says he has seen documents showing the debt is for sale for "about 30 cents in the dollar".
Petroceltic is unable to meet repayments and is surviving on waivers from its banks, the latest of which runs out on Friday. Its debts are secured against its assets, including a prime Algerian gas field, and it is effectively for sale.
“Lenders are offering the debt in the market. It was in documents sent to market participants, including us, fairly recently,” said Mr Moskov, who has repeatedly criticised Brian O’Cathain, Petroceltic’s CEO.
Tumbling shares
Worldview’s Sunny Hill told the stock market it will offer 3p per share, a total of £6.42 million, for UK-listed Petroceltic, sending its share price tumbling, although it still traded at about 10.5p yesterday.
Mr Moskov insisted the equity in Petroceltic is “zero” and retail shareholders don’t appreciate the “critical” impact of the debt woes on its value.
“I personally have yet to meet a reasonable human being who can come up with a value of more than zero for the equity,” he said. “It’s not rocket science. It is at the mercy of its lenders. If the lenders are willing to offer such a discount, what do you think the equity is worth?”
Worldview’s offer has been dismissed by some brokers as “derisory” and “insulting”, with suggestions that its multitude of clashes with the board contributed to Petroceltic’s current difficulties, which are also a reflection of the carnage being wrought on the sector due to the oil price collapse. Mr Moskov said those brokers’ suggestions were “offensive”.
‘Delusional’
“We can all write insulting things. I have expressed my view with the number [of the offer]. Some of the values that are being put about on forums and elsewhere – that the true value is 40p or 50p per share – are delusional.”
Mr Moskov, who noted that he is restricted in the nature of any new comments by takeover rules, reiterated a litany of previous criticisms of Petroceltic management, including claims related to development strategy and costs.
Petroceltic did not comment on Wednesday, but it has previously strongly rejected all of those criticisms and has accused Worldview of wanting to take it over on the cheap.
To date, management has retained the support of major shareholders including Robert Adair, the chairman. Worldview's promised offer needs 90 per cent acceptance to succeed. Details will be posted to shareholders next week, once Worldview receives the register, ahead of a full offer document in coming weeks.
