First Oil 19 October 2018 - SP Angel's Snapshot of Oil & Gas News


19th October 2018


  • In Brief:
    • Frontera Resources (LON:FRR) – 0.40p– Victory is About Perspective

In Brief

  • Frontera Resources (LON:FRR) – 0.40p – Victory is About Perspective: Today’s announcement reads like a great outcome for shareholders, and although it is a positive, the payment mechanism and timetable has now become a choke chain to suffocate and dilute returns, which will be a headwind to the individual shareholders ever seeing value in their shares, if there wasn’t already enough. We believe that the payoff for rescheduling the payments, which are onerous and a reflection of the weakness of management’s claims, is a simpler default mechanism. In this context, we think it’s a pyrrhic victory that management claims. Many might claim this as a victory against the creditors, let’s be clear, it isn’t, especially for shareholders, who get stuck with the same woeful management team that has led them from failure to failure. Legal victory is about perspective, and the if you’re a management team that is so poorly performing, as this one is, then today’s outcome is a truly great day, and should read like the triumphant proclamation, even if it’s a disaster for shareholders.

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