Oil company Afren could also be facing a bid battle, as billionaire Chinese tycoon Guo Guangchang, whose Fosun conglomerate recently bought Club Med, is backing a cash bid to prise the former FTSE 250 company away from its fund management owners, the Sunday Times revealed. Guo and Afren's co-founder Bert Cooper have put together a $500m (£325m) bid but is thought likely to be pipped by a rival bid from the oil company’s bondholders, US-based Pimco and London fund manager Ashmore, who have tabled a $300m deal.

uk.advfn.com/p.php?pid=chartscreenshotsh...Q4%3D&symbol=L%5EASC

uk.advfn.com/p.php?pid=chartscreenshotsh...iM%3D&symbol=L%5EASC

Watch the 20 day ema and the rsi, retesting the breakout atm...
A fall below this could send this tumbling quickly imho...
watch carefully, and good luck, i think this will have a nice move move up, high risk though...

Regards,
Trendfriend.

I again shorted Afren (AFR this morning - this time at 9.25p. My reason is that there is still no rescue bid where time is running out: this company will be in its loan creditors’ hands come Friday. The price might settle at 1p.
www.spreadbetmagazine.com/blog/the-evil-...nting-for-taste.html

I'm Long again as well Paitech, @ just over 9p

Bought afr sub 9p today

fwiw ..... 19-Feb-15 Westhouse Securities Sell 90.00 2.00 Downgrade
came out out shortly before today's close

Trendfriend,

Well could have sold at high point..but waited..being greedy...

atlast sold at 11.6p..... now waiting to buy back...later

ta
G

Hi Remo,

It did'nt quite go that that low, the first low was 4.01p according to Reuters, the second was slightly higher at 4.10p.
It was very close though....

Would it still be valid if it broke above 15p in you opinion??

Regards,
Trendfriend.

I highlighted the 123 low a few weeks back on the share tips...well this is not a 123 low any more as the price went back down to that low point which neutralized the 123 low.. This is now a trading range play. You can see clearly in the chart how thats going.


dl.dropboxusercontent.com/u/4899609/afre19thfeb2015.png

You still Holding Paitech??

Looks good to me, re-tested support/resistance @ 12.25p area, and bounced back nicely....

15p looks more likely now....

Regards,
Trendfriend

Up another 60% now to 14p.
Hold or sell....tic toc
Good day all
Ta
G

So, 35% up, not bad!! lol

I was really encouraged with this today, it broke above the 20 day ema, which gave it a good boost, came back retested the 20 day again and then bounced of it... Looks good to me short term at least...

Firstly the rsi is bang on resistance, should break out tomorrow am... a break above could be the signal the rebound has more legs....
uk.advfn.com/p.php?pid=chartscreenshotsh...BKcc=&symbol=L%5EAFR

These are the levels to beat.. 12.25p, 15p and 17.5p . Lets see what this does tomorrow.
uk.advfn.com/p.php?pid=chartscreenshotsh...NU%3D&symbol=L%5EAFR

Regards,
Trendfriend

The city boys will sell down before the close As they have done for weeks and let the Pi's take all the risk. If it holds the highs it is the PI's who are holding it IMO

I think this is a PI driven rise, no way of being sure though....
In any case, i always like to focus on numbers, Sir Richard

Forget all the noise imho (no disrespect meant to anyone here on CV), but you know what i mean....
As long it hits the numbers i'm looking for, i really don't care what happens to Afren in the end tbh...

Regards,
Trendfriend

TF,,One thing that does concern me slightly with this rise is the lack of AT trades which tells me that its not being driven by the trade ,,,, so far today 85mil traded of which AT's only 12mil ,, maybe it will change into the close

The key is the b/e cost for the company as this determines whether they are generating free cash or spending reserves. Seems to me it is above 60 as the sp is still foundering. If it's above 80 then there ios little hope for free cashflow this year.

If someone knows the number, please volunteer it

Without all the information it is a gamble and it is probably still a gamble with it! The prevailing SP is usually an indication of a placement price, but not always.

cynic wrote:

The fundamental argument if this is a buy or a sell, can go on and on, all depends on your view point imho
maybe best to stick to technicals.

This has broken the 20 day ema. A close above i think 15p is real possibility imho.... Lets see at the close
High risk, (so stops are a must imho) but potentially high gain as well.
Understandable why folks would steer clear... not a bad idea tbh....

uk.advfn.com/p.php?pid=chartscreenshotsh...OcU=&symbol=FT%5EUKX

Best Regards,
trendfriend.

Hi All,

I hold afren at around 46p average, around 2k £.

But then I bought few..at around 5p, around 7K £ and sold as soon as it hit 14p last time.. as it was support from long back.. it went to high of 18p and then back towards sub 5p after the bid offer was rejected.

I bought in again another 7k £ at 5.1p, again, and holding it now.. to sell at 10p today? or.. may be hold bit more.. I know its risky one.. but...

May b will sell if it hits 14p again... or may hold...

Good luck to all.
ta
G

not sure if this is the best way to respond .....

extraction and production costs are known, though i don't recollect them
assuredly they are higher than the present level whether based on Brent or WTL

if i read you correctly, you side with my view that PIs will end up with zilch, though there may well be good profits for the very brave and professional traders

Whether any finance deal with bondholders and any re-financing gives the shareholders anything depends on two things:

a)B/E cost of production (no one seems to know this)
b) a placement price (no one knows this)

The only re-financing I can imagine will be equity, depending on a) of course (but no one seems to know this) No banks would touch it (lots of defaults for Nigerian Banks) and I can't imagine the bondholders throwing more good money away

The bullish engulfing patter at yesterdays close gave the rise today, but it is based on hype and gambling.



cynic wrote:

I don't disagree that Afren is in a dire position at this present moment in time but Im of the opinion that a refinancing deal will be achieved ,,, I will trade the stock from a technical point of view ie,, close above 10.25 would be an early entry point for the brave and a close above 15.00 for the 123 low breakout with tight stops,,,

obviously that influenced it but as far as i can see, AFR remains completely rudderless and mired in huge debt
i also suspect there would be yet more skeletons in the cupboard if anyone wanted to bother to dig

if you disagree with my view - more than welcome of course - tell me/us why anyone would want to buy the company with its debt and still leave PIs with even a crumb?

for all that, i'm still not nearly brave enough to go short!

Hi cynic ,,,, just interested to know if your opinion re Afrens future is based having also read last Fridays RNS re the seplat offer rejection ,,,,

as i'm a complete newbie, you will not know me

anyway, i reckon AFR is a dead duck as far as PIs are concerned
as far as i can see, there are 3 possibilities

1) a deal will be done and the PIs will get something out of it - i don't believe that
2) a deal will be done but the PIs will get zilch - the most likely outcome imo
3) no deal will be done, in which no one gets anything - the least likely imo

=============

i should have added that, as far as i can see, there are a lot of professional (computer) traders playing with this for quick profits in either direction, but far too dangerous waters for me

Perhaps Remo should have a gambling section?

I'm staying out of this one, good luck with it!

M.

Any thought's on this folks??
I've got a small speculative long here.
Firstly the downtrend (the mother of all, lol)
Weekly Chart.
uk.advfn.com/p.php?pid=chartscreenshotsh...E0%3D&symbol=L%5EASC

Close up to the current action, no real green shoots tbh, other than a higher low but i will add some if it can close above the 20 day ema.(around 10.5p)
first to admit this is very, very risky, a gut feeling this is going to have a nice bounce, so lets see.
uk.advfn.com/p.php?pid=chartscreenshotsh...Tg%3D&symbol=L%5EASC

Regards,
Trendfriend

Oops! Forget that last post lol! This is now for gamblers only now that the (all time?) low has been smashed.

Ahh! Thanks F4T!

The 2009 low

Thanks for your chart, and please excuse this dumb question - but what gives you 13.75?

Thanks,
Anne

13.75 looks like a good entry here.





F4T

Gamble it is then

Confirmation on bullish engulfing pattern Friday and an RSI breakout. If it can break through that trendline at ~74 early next week we might get a higher low confirmed. Might be interest leading into the OPEC meeting later this week. It would be a gamble IMO to hold through it though.

Crude oil is in big trouble. Falling wedge broke down yesterday. IMO we should see further weakness in Afren. After 67 the next meaningful support is at 62. I don't have access to a postable crude chart.

uk.advfn.com/p.php?pid=chartscreenshotsh...gzyQ=&symbol=A%5EAPT

F4T

No worries Count, didn't mean to sound pompous!. You are correct, it is one of the lower risk trades to take, so fair enough. The most important assets are patience and eliminating emotion, plus a bit of money management. The first two are the hardest. You can read the tension into a lot of posts and that drives mistakes.

GL as always
F4T

Hi Ian,
Yes you are right, 123 low is a simple trade for novices like me, with a reasonable success rate. I'm still licking my wounds from large previous losses so am cautiously trying to build up my trading float again ')
Really appreciate all your help and advice on here though mate, learning a lot from you guys.
ATB

Didn't see that Count. Have now. Nothing negative there. I think it is simply following crude prices. I read somewhere that Afren has high finding costs, so energy prices are key, like the shale gas companies.

Crude is nearing the apex of a falling wedge, so might see some action in the coming days.

You guys on here seem to be obsessed with horizontal breakouts! There is much more to TA than that mate!

RNS was sold into this morning (as is typical nowadays), however, this could lead to formation of 123 low back into the 90's, lets wait and see. I'm holding a few atm.

Nice hammer on the weekly. This should get to 90 this week IMO.

uk.advfn.com/p.php?pid=chartscreenshotsh...u0%3D&symbol=A%5EAPT

Bullish piercing line, back through 72.25 horizontal support and looking like it likes yesterday's low. RSI and MACD divergences on shorter timeframes. Only second white candle in ten, which is notable. Key is that RSI support held, but not enough volume yet to confirm.

US crude inventories helped yesterday but after it had already turned.

Looks promising to me but with reservation on volume.

Problem at the moment Count with E&P companies is that crude is being hammered and the US$ isn't helping. When crude prices turn the outlook for companies with revenues like Afren should improve.

At the moment there is not enough volume being traded at this level to indicate a bottom might form, but it is hanging in there so far.

I wouldn't let your emotions run away mate. A couple of weeks ago some on here were calling doomsday on the indices and GKP at 10p lol. Swings and roundabouts. US markets ARE about to retrace again though IMO. GL

Hi Ian,

Afren made 5 year low this morning SP 71.35, lowest since end Aug 2009. I was tempted to dip my toe in but think I'll hold off and wait and see, there is a definite chance that this may fall to low 50's even low 40's if this negative sentiment continues. It could well become a take over target at those prices. If, however, there does appear to be strong bounce from here back towards low 90's then I may jump in for a quick ride. A significant announcement such as some new replacement board members with gravitas would certainly help re-instill the lost confidence here.

This is fragile but IMO there is an excellent chance of this bouncing or finding a bottom at 72.25. RSI approaching support and first resistance in the 90/92 area for a decent return when/if some confidence returns (on daily and weekly).

uk.advfn.com/p.php?pid=chartscreenshotsh...UmAQ=&symbol=A%5EAPT

uk.advfn.com/p.php?pid=chartscreenshotsh...oY%3D&symbol=A%5EAPT

Monthly Chart if it helps

Hi all, I don't really want to comment further on this since I don't believe technicals can give an edge here. Bad news is coming, the only question is how bad.

The only way to look at this is sensibly and not like a PI. Wait for the news and then act rationally without emotion

Support at 73 might be a good bet post news.

F4T

A new 123 low on the daily as well TF with a target of 104.75 should 99.40 break to the upside

uk.advfn.com/p.php?pid=chartscreenshotsh...Kfvs=&symbol=L%5EAFR

Just one to keep a eye on for now, if this can get above the 100p, and the 20 day @ 101p currently, i think it could be in the mood to target the 120p region, around the 200 day ema, and the gap area.

Maybe, F4T can take a look please? and tell us what he thinks.

Regards,
trendfriend.

After all that recital and to close the circle, I have finished my business here. It doesn't look like it will break out of the 90's currently and with news due anytime this month that could send it materially up or down, I will sleep very soundly with no position.

GL
F4T

Well, a return to the recent low today so the jury is out on this though I am still interested in this currently. I am not in any way suggesting people buy this as it is clearly high risk, but i will give my thoughts, much of which are fundamental as this is unavoidable with this stock currently.

Technically, the 90/91 low has so far held again today which is positive as the lows are still being bought up, though the fall from Fridays close gives some concern given my earlier technical comments. I expected a 50% retrace to 94.50 this morning then a rise but we got 100%.

IMO 94 and 97.50 are key initial resistances in any rise. I believe that 73 is a firm support below.

uk.advfn.com/p.php?pid=chartscreenshotsh...G0%3D&symbol=A%5EAPT

We do have positive divergence on MACD and RSI on the hourly, which I like. Also on the daily but this is distorted by the initial fall from 140's.

On the fundamental side, there is IMO a lot of fear and misunderstanding of the issues by some in the market, perhaps by those who are not learned in either the E&P international scene or company/corporate finance.

I see it this way. The directors took kickbacks on the permission payments to a third party, who I understand is their partner in Nigeria. Clearly this indicates that the company payments were in excess of what they would have been with an arms length deal. For this reason I believe that the asset values in the books is erroneous though I am not up to date on the IAS rules on this currently. There could well be a writedown if the funds are not recovered and maybe even if (some) are. I would imaging that the auditors would push for this since some of the sums are / will be known. This would be viewed very badly by the market.

Whatever the directors took, double that as the other side's management would have had their cut also. In a lot of countries/cultures this activity is normal, even expected. Not right, but more common than you might think. It is not so common for UK directors to do it, but often a necessity to pay "middle men" to get a deal done. I expect that the kickbacks would have been minor compared to the total payment in the financials but certainly significant and material to a layman. Alot of people appear to have had their names on the list, which is concerning.

The issue for the company is threefold
a) disclosure of related party transactions (a company can pay what it likes for permissions/assets, the directors having that power assigned to them by shareholders. It is called management's judgement.) and
b) There are also now strong regulations regarding corruption within western companies. These are regulated in the company's listing and their financial reporting. I think it is more the latter that will upset the market/City.
c) The directors misleading the shareholders in the course of their fiduciary duty.

So, for an investor, what are the problems/negatives with buying this stock?

1. The unknown / Being in the dark over the finer detail. Lot's of comments, but who is right and who is off the mark? How many skeletons and how nasty are they?
2. Institutions (some/all?) may be forced to sell under their own internal guidelines re: corruption etc. This put's downward pressure on the stock. In any case, they could not buy more until the issue is resolved.
3. Are the remaining management competent? Can the business' reputation be saved or must it be sold?.

This type of scandal casts a(nother!) shadow over the smallcap and midcap E&P sector as it puts doubt in an investors mind. Something else to bear in mind is that when a company is under such a cloud it cannot be valued on it's assets anymore or not until the shadow is totally removed, so forget that as an upside target.

I met the suspended CEO a few years ago. Very laid back and smooth talking.

All IMO and conjecture.
F4T

There, you see I do follow fundamentals Learner!