Serious slump to .83 and vicinity on no news. Suspension of div? Another fiscal heart attack cf VNR?
Behavior doesn't square with Dan's numbers.
MEMP mugged after hours
Re: MEMP mugged after hours
if volume low, its probably some chump putting out a market order and being taken by a sucker bid.
Re: MEMP mugged after hours
Other trades in the .90s so far (5:30pm), 25-40% down. Suggests a news flash pending or a fabulous blue light special.
Re: MEMP mugged after hours
Here is the catalyst --
6:37 pm Memorial Production Partners suspends quarterly cash distributions, initiates process to explore strategic alternatives (MEMP) :
The co announced that the board of directors of its general partner has elected to suspend MEMP's quarterly cash distributions to unitholders, effective immediately. The board believes the suspension is in the best interest of the Partnership. The Partnership also announced a reduction of its borrowing base under MEMP's credit facility from $925 million to $740 million, effective October 28, 2016, which will be further reduced to $720 million, effective December 1, 2016. These reductions are part of the Partnership's semi-annual borrowing base redetermination process. As of October 28, 2016, MEMP had approximately $714 million outstanding under its revolving credit facility.
"Our board and management team believe that suspending the distribution at this time will help preserve liquidity and enhance MEMP's operational and financial flexibility. The scope of the redetermination is disappointing given the strength of our operations and significant cash flow generation. We look forward to continuing discussions with our lenders, and we note that the redetermination will have no impact on current operations, which will continue in the normal course."
The Partnership has initiated a process to explore strategic alternatives to strengthen its balance sheet and improve its capital structure. MEMP has retained Perella Weinberg Partners L.P. as its financial advisor and Weil, Gotshal & Manges LLP as legal counsel to assist the board of directors and management team in this review.
6:37 pm Memorial Production Partners suspends quarterly cash distributions, initiates process to explore strategic alternatives (MEMP) :
The co announced that the board of directors of its general partner has elected to suspend MEMP's quarterly cash distributions to unitholders, effective immediately. The board believes the suspension is in the best interest of the Partnership. The Partnership also announced a reduction of its borrowing base under MEMP's credit facility from $925 million to $740 million, effective October 28, 2016, which will be further reduced to $720 million, effective December 1, 2016. These reductions are part of the Partnership's semi-annual borrowing base redetermination process. As of October 28, 2016, MEMP had approximately $714 million outstanding under its revolving credit facility.
"Our board and management team believe that suspending the distribution at this time will help preserve liquidity and enhance MEMP's operational and financial flexibility. The scope of the redetermination is disappointing given the strength of our operations and significant cash flow generation. We look forward to continuing discussions with our lenders, and we note that the redetermination will have no impact on current operations, which will continue in the normal course."
The Partnership has initiated a process to explore strategic alternatives to strengthen its balance sheet and improve its capital structure. MEMP has retained Perella Weinberg Partners L.P. as its financial advisor and Weil, Gotshal & Manges LLP as legal counsel to assist the board of directors and management team in this review.
Re: MEMP mugged after hours
The worst thing that has happened to all of the upstream MLPs is that they have been cut off from the capital markets. With the unit prices so depressed, they cannot raise money by selling equity and the bankers are not their friends these days.
MEMP is generating free cash flow from operations, so Chapter 11 does not seem likely.
Higher oil and gas prices are what these chaps need. If commodity prices move up then the bankers will suddenly be their friends again.
MEMP is generating free cash flow from operations, so Chapter 11 does not seem likely.
Higher oil and gas prices are what these chaps need. If commodity prices move up then the bankers will suddenly be their friends again.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group