He's back. The bankruptcies will now begin.
------
"Papa now takes the help at Silver Run Acquisition, which is a "blank check" company, or SPAC -- a special-purpose acquisition corporation. What that means is that Silver Run has raised cash for the specific purposes of making yet-to-be-identified acquisitions.
Getting an IPO done this year is impressive. Year to date, there have been five IPOs in 2016 at this point, versus 22 last year.Getting an IPO done in the energy sector is considerably more impressive.
That speaks to the respect Papa commands -- as does the fact that Silver Run raised $450 million, which was $50 million more than it planned on raising."
he's the enron guy?
>>1153392
Jeff Skilling spun him off. That was before Jeff went to jail.
Sold EOG for $400 million because Jeff needed cash fast. Then oil went from $30 to $150.
Jeff Skilling was supposed to be smart. Turns out Mr. Papa was the smart one.
Backstory, please? This sounds interesting and potentially profitable
SILVER RUN ACQUISITION CORP (SRAQU) IPO
Overview News Headlines Financials & Filings Experts
Key Data Use of Proceeds Competitors
Company Overview
Company Name SILVER RUN ACQUISITION CORP
Company Address 1000 LOUISIANA STREET, SUITE 1450
C/O RIVERSTONE EQUITY
HOUSTON, TX 77002
Company Phone 7133571400
Company Website --
CEO Mark G. Papa
Employees (as of 2/25/2016) 3
State of Inc DE
Fiscal Year End 12/31
Status Priced (2/24/2016)
Proposed Symbol SRAQU
Exchange NASDAQ
Share Price $10.00
Shares Offered 45,000,000
Offer Amount $450,000,000.00
Total Expenses $900,000.00
Shares Over Alloted 0
Shareholder Shares Offered --
Shares Outstanding 56,250,000
Lockup Period (days) 180
Lockup Expiration 8/22/2016
Quiet Period Expiration 4/4/2016
CIK 0001658566
We are a newly organized blank check company incorporated as a Delaware
corporation and formed for the purpose of effecting a merger, capital stock
exchange, asset acquisition, stock purchase, reorganization or similar business
combination with one or more businesses, which we refer to throughout
this
prospectus as our initial business combination. We have not identified any
potential business combination target and we have not, nor has anyone on our
behalf, initiated any substantive discussions, directly or indirectly, with any
potential business combination target. Although we may pursue an acquisition
opportunity in any business or industry, or one that does not fit with Riverstone's mandate, we intend to capitalize on the ability of our management team and the broader Riverstone platform to identify, acquire and operate a
business in the energy industry that may provide opportunities for attractive
risk-adjusted returns
We intend to identify and acquire a business that could benefit from a
hands-on owner with extensive operational experience in the energy sector and
that presents potential for an attractive risk-adjusted return profile under our
stewardship. Even fundamentally sound companies can often under-perform their
potential due to a temporary period of dislocation in the markets in which they
operate, inefficient capital allocation, over-levered capital structures,
excessive cost structures, incomplete management teams and/or inappropriate
business strategies. Our management team has extensive experience in identifying
and executing such full-potential acquisitions across the upstream, midstream,
refining, power, services and renewable energy sectors. In addition, our team
has significant hands-on experience working with private companies in preparing
for and executing an initial public offering and serving as active owners and
directors by working closely with these companies to continue their
transformations and help create value in the public markets
>>1153300
this is really interesting. is this a decent gamble? what exactly is being risked buying SRAQU? is Papa an accidental success or is he the real deal?
pls summon the wizard.
This is interesting thanks for the tip OP.
So what do they do once they acquire assets? Do they hire services and drill or just sell once the market rebounds? I dont completely understand the business model
Bump. Got 20 shares
>>1155128
I don't completely understand it either. From what I've been reading... the acquisition company will take our money and search around for something to buy. In this case the target purchase will probably be something in the oil and/or natural gas industry. maybe E&P... maybe transportation, refining, or whatever seems like a good deal.
If they don't buy something within two years they give the investor's money back? A stock buy-back? So... if they haven't made a move and its coming up on two years the stock price will plummet as ppl try to get out and the company essentially makes money by buying back the stock at a really depressed price?
(Is any of this correct?)
If the SPAC does buy a company they merge and the investors now have shares of the new company?
So, this is really a gamble for "investors" who have enough faith in the management team behind the SPAC as well as industry and market conditions. Right?
>>1155128
http://www.nasdaq.com/markets/ipos/company/silver-run-acquisition-corp-985179-80240
>>1155322
Their expenses are so low that you'd likely get close to the original $10 back after 2 years or no action. If you read the link, it looks like there is $450mm in a trust that can only be touched for acquisitions or reimbursement. Also looks like there are 56,250,000 total shares outstanding including warrants
So, no acquisitions after 2 years would result in each share being reimbursed $8, not including any interest that has accrued in the trust.
Does this look right? That's what I got out of the filing
The volume on this stock is miniscule. Im surprised I even got my order filled today wtf. This seems like the kind of stock you definitely want to be holding when its name comes up in an asset sale news piece on a big distressed E&P like CHK or MRO and the dumb money comes flooding in. Thanks OP
>>1155335
well, that's what I read... but I've never bought this kind of thing before.
here's the article that helped me decide to gamble a little bit on SPAQU: http://seekingalpha.com/article/3959599-oil-portfolio-just-acquired-silver-run-acquisition-corp
well... that and Papa's reputation, management style, and history with EOG...
I'm looking at this as a pure gamble with fun money... so I'm not tying up much in this.
+10 shares
>>1155335
113$ spent $80 insured. Real risk $25 + 7$fee
Will have to get to 100 shares. 0
This is exponential Returns for limited risk.
Just gotta wait for a few battered oil companies to kick the bucket.
>>1155469
This is what I was about to post. You have 20% downside insurance with unlimited upside potential. As a gamble this is a dream
>>1155322
Well I'm not sure how they're going to structure it. but I'd assume this would just be a holding and management company after the acquisition. But they'll be buying bankrupt assets at probably 0.50 on the dollar. and worst case they can't restructure well they liquidate for small profit.
>>1155364
>>1155364
I think the IPO company is still on the initial public resale so anything will get filled.
What's the lowest bid you guys have gotten?
But I think it'll be a great hedge to my already battered oil positions.
Damn you SDRL
>>1155513
>every 3 shares comes with a warrant to buy 1
the holy trinity. this surely is a sign from G-d!
i don't know anything about warrant other than what i just read today. it seems like a nice way to sweeten the deal. don't know if these can be detached or not either.
scared noob making bankers and brokers rich here.
>>1153674
>>1155513
So what are the
LOCKUP PERIOD
QUIET PERIOD
Initial was $10, the financier bringing to market
Just did some summing
7,892,414 total Volume since open.
Someone's The IPO company holding
37,107,586 shares.
I'd assume once the public purchases a significant laddered amount, escrow funds get released to the company
I'm gonna have to look into it at the SEC tonight. Never done this before.
>>1155600
from the SEC filing:
Report of Independent Registered Public Accounting Firm
Balance Sheet as of February 29, 2016
Notes to Balance Sheet
3. Public Offering
In the initial Public Offering, the Company sold 50,000,000 units, including a partial exercise of the underwriters’ over-allotment in the amount of 5,000,000 units, at a price of $10.00 per unit (the “ Units ”). The Sponsor purchased an aggregate of 8,000,000 warrants at a price of $1.50 per warrant in a private placement that occurred simultaneously with the completion of the Public Offering.
Each Unit consists of one share of the Company’s Class A common stock, $0.0001 par value, and one-third of one warrant (each, a “ Warrant ” and, collectively, the “ Warrants ”). Each whole Warrant entitles the holder to purchase one share of Class A common stock at a price of 11.50 per share. No fractional shares will be issued upon separation of the Units and only whole Warrants will trade. Each Warrant will become exercisable on the later of 30 days after the completion of the Company’s Initial Business Combination and 12 months from the closing of the Public Offering and will expire five years after the completion of the Company’s Initial Business Combination or earlier upon redemption or liquidation. Once the Warrants become exercisable, the Company may redeem the outstanding Warrants in whole and not in part at a price of $0.01 per Warrant upon a minimum of 30 days’ prior written notice of redemption, if and only if the last sale price of the Company’s Class A common stock equals or exceeds $18.00 per share for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which the Company sent the notice of redemption to the Warrant holders.
>>1155620
I feel like an idiot meow for not buying a multiple of 3.
How do you exercise warrants anyway? I understand the terms but is there an "exercise warrant" button to click or what? Anyone dealt with this before?
>>1155815
i think you'd have to call your broker.
>>1154324
I'm here. Been waiting on the dollar to rally.
He -- Papa -- is the real deal. Not afraid to bend with the winds. No real ego; just likes to make money.
Other than John Arnold, Mr. Papa was the only other "nice guy" at Enron. Maybe Kinder as well but that was before Skilling and Fastow's fuckery.
Everyone in the oil patch loves this Papa's business acumen. He will make 4 times as much money on specific deals as he will lose from time to time. If he had a Sharpe ratio it would be at least 2. His cost analysis is excellent and his risk management is superb.
So, he will soon be buying energy related companies for $0.20 on the dollar and all he will need is a long, slow recovery combined with no dumbass business decisions. A rising tide will lift all boats and I think that's what he is doing now. He couldn't stand being on the sidelines with the fabulous energy acquisition opportunities to be put before him over the next year.
I hope you all make a lot of money.
>>1155620
Thank you.
Looks like I've got to work for the money to buy 290 more shares.
>>1157097
Great article. This guy is spot on. Forward looking, no nonsense businessman. I invest in people and I definitely trust him with my money
>>1153300
bump for more exposure!
