Macro Tsimmis

intelligently hedged investment

Transmeridian (TMY) update #12

Posted by intelledgement on Mon, 31 Dec 07

Happy New Year!

Transmeridian (TMY)—our E&P with a potentially world-class property in Kazakhstan that have been suffering with production issues and soliciting takeover bids—announced today that having failed to receive any offers they deem worthy, management have raised their own war chest and are bidding to take the company private at $3/share. CEO Lorrie T. Olivier has formed an investment vehicle, Trans Meridian International, Inc. (“TMI”) to make the all-cash offer for the purpose of acquring “as many outstanding shares as possible of the Company’s common stock as a first step in a ‘going private’ transaction resulting in TMI acquiring the entire equity interest in the Company. If the transaction is completed, TMI contemplates that the shares of the Company’s common stock would be delisted from trading on the AMEX and deregistered with the Securities and Exchange Commission,” according to the press release.

Our take is that TMY management have lined up adequate financing here and that this offer is virtually money in the bank. We think the rights to the South Alibek field are a steal at $825MM. (Naturally we do, considering we paid the equivalent of 10% more than that for our shares. And of course now we regret not buying more at $1.40 last week. LOL) Accordingly, we plan to play through on this one and hold our shares to see if this tree-shaking exercise causes any serious counter-offers to drop down to the ground.


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