*As time is running out to get bids in, please contact me as soon as possible in order to register your interest. The offer closes this Friday 22/11/13. I personally think this stock may take a bit longer to see results and show this in their share price than the other previous floats mentioned below. I see this stock making returns in about 6-10 months.
Luke Pilkington, Private Client Advisor, BBY Limited.
P: 03 8660 7260 E: ltp@bby.com.au
The interest in this IPO is right up there. We have just seen Regeneus, that was floated last month by BBY Limited, trade at $0.54 after floating at $0.25. BBY has a history of successful IPO’s with the last two Regeneus (RGS) and Strata X (SXA), currently up 116% and 36% respectively. BBY was also the lead manager for the Kina Petroleum IPO in 2011. The stock floated at $0.20 and is currently up 145% at $0.49.
Don’t miss out on this stock. Other brokers have registered there interest and want a firm allocation of how much stock they are able to offer their clients. Please make sure you contact me to register your interest or submit bids in order to get priority allocation of the stock over brokers/clients outside of BBY.
The details of the float are as follows:
Real is a compelling investment story and has some unique features not usually associated with an IPO:
– Real has ~2m acres in the Cooper basin and is targeting 3 separate plays, the first 2 to be tested during the first drilling program
– All current shareholders are escrowed for 12 months (those that aren’t ASX mandatory and voluntary escrowed their stock). The only stock that will trade in the first 12 months is the IPO stock.
– IPO subscribers receive a loyalty option which vests 120 days after listing. 1:2 basis, 30c, 18 month expiry, listed
– Company currently has $5.7m in cash, will have circa $15m post IPO
– Current shareholders committed to take approx. $4m of the IPO offer
– EV/Valuation per acre ~$13 vs. Cooper basin average of ~$115/acre. Recent transactions have been as high as ~$900/acre (Chevron $350m farm-in to Beach Petroleum)
Offer Details
Amount: $10 million
Market Capitalisation: ~$41.9 (immediately following the offer based on $0.25/share)
Price: $0.25/share with 1:2 fee attaching option (30c)
Offer closes: 22 November 2013 (Company reserves the right to close early)
ASX Listing: ~5 December 2013
Restrictions: Offer being made under Prospectus and open to institutional, sophisticated and retail clients
Jurisdictions: Please refer Prospectus for jurisdictions outside of Australia
Why we like it at BBY?
- The Cooper-Eromanga is a proven hydrocarbon province with a long established oil and gas industry which is in the advanced process of ‘proof of concept” stage for its significant unconventional oil and gas resources.
- The basin is well serviced by oil and gas pipeline infrastructure and service providers;
- Many other companies including Beach Energy/Chevron, Santos, BG/Drillsearch and Senex are chasing the same play throughout the basin. Hence strong potential news flow;
- Over 2,800 petroleum wells have been drilled since the 1950’s and there are 160 gas fields and 80 oil fields, containing approx. 640 producing gas wells and 350 producing oil wells. Over 6Tcf of gas and 300MMbbl produced.
- Potential for substantial valuation uplift from:-
- (1) exploration and development success;
- (2) further consolidation in the basin; and
- (3) success from peers operating across the basin who are at a more advanced stage and operating current programs.
- Gross Mean Petroleum-in-Place – ~19 billion bbl & 45 TCF gas (est. by AWT International & internal sources). Company has a number of conventional oil & gas prospects and leads (up to 21 MMbbl and 111 BCF) which has the potential to generate early cash flow;
- Valuation: EV/acre is ~$13 vs. basin average of $115/acre;
- Company will be well funded, currently has ~$5.7m cash at bank pre IPO raise;
- Register consists – Directors (30%), Och-Ziff (11%) and Asian based HNW (23%). All are voluntarily escrowed for 12 months;
- Directors and management ex Mosaic Oil NL;
- Structure of Offer:
- Loyalty Option for IPO investors
- Seed shareholders have agreed to 12 months voluntary escrow.
- Substantial number of Seed shareholders participating in IPO.
Important Dates
| Offer Closing Date |
22 November 2013 |
| Settlement under the Offer |
27 November 2013 |
| Basis of New Share allocation announced |
27 November 2013 |
| Expected issue and allotment of New Shares |
27 November 2013 |
| Expected date for despatch of holding statements |
2 December 2013 |
| Shares Commence Trading on ASX on a normal T+3 basis |
5 December 2013 |
Happy Trading.
Pilkington Trading 