OAS & TPLM

[dan_s]

These are both fairly new companies, so I doubt they are interested in merging. They have plenty to do with the good acreage they already hold. That said, anything is possible. I do rate them both as prime takeover targets.

[ghrcap]

TPLM reminds me of UNT, with three divisions within each: an E & P, a service company and a pipeline company. TPLM says it has been designed, financed and is being run with a future (18-24 months) break up in mind. UNT resists that notion and as a result has never earned the market multiple it should command. I suppose UNT could make a run at TPLM and hold it together to harvest synergies, but I doubt a pure E & P would want any more than TPLM's producing and exploration assets on the spin. I suspect more than one private equity firm has a team working on TPLM and won't wait as long as TPLM would like. Pay the 25% premium now while TPLM is young and don't let Samuels season it, commanding a higher number down the road.

[dan_s]

If you listen to the last quarter conference call, it is clear that TPLM management thinks their oilfield services firm (frac crews + equipment) is worth a lot more than what the market is giving them credit for. I agree.

I agree with you that most companies that are looking at TPLM just want the E&P assets. This would be a great acquisition for Hess. They could use all the parts. Hess already has an extensive midstream business in North Dakota and they could definitely use the frac crews or spin them off for cash.

Hess has a Business Development group that looks at stuff like this. They reported to me for three years.