Are $250,000,000 EZ to Get or What?

[Tree]

How can ennerOle miss eranings and receive a $250,000,000 loan??

[Spartina]

I think it's cause of their really cool logo.

[admin]

Perhaps the banks thought they were dealing with the International Olympic Committee

[johnwgrant]

How can ennerOle miss eranings and receive a $250,000,000 loan??

Tree - you make a very good point.   InterOil back in November of 2010, issued stock and $70MM of convertible debt to raise $266MM of cash.   The shares and convertible debt represent about 4MM shares of company stock.   Say for round numbers about 10% dilution at the time (2010).

Now, we are (...wait for it...) "on the cusp" of a deal and are able to raise $250MM (not all of which will be used I am sure) to backstop our drilling program.  This is basically a group of banks saying that they are "highly confident" Hession's team will deliver.   It also is a clear signal to the shorts that they will not be able to wiggle out of their short position by buying stock when InterOil is "forced" to issue stock due to their low cash position.

So, if you are short, you had better cover or hedge via options - this deal is going to get done.    My thinking is the 2nd week of December is the actual announcement.   But, who knows !?!?!?