Harold Hamm’s Hiland Buyout Has Upside

October 25, 2009

Hiland PartnersIt is doubtful that the buyout of the Hiland MLP (HLND and HPGP) by billionaire Harold Hamm will get sufficient votes at Tuesday’s shareholder meeting. This is already the second meeting after the Otober 20 meeting was adjourned when only 43% of the publicly held shares voted in favor. Both Hiland companies have significant upside if the deal falls through.

In our recent Hiland posting we speculated that Read the rest of this entry »

Hiland: The Worst Deal Among MLP Consolidations

October 14, 2009

Among the many consolidations of MLPs (recall the mergers of Magellan Midstream MMP, Atlas ATLS or the pending Enterprise/Teppco EPD/TPP) one deal stands out as a particularly bad deal: the opportunistic squeeze-out of minority shareholders of Hiland Partners (HLND) and Hiland Holdings GP (HPGP) at record low prices by oil magnate Harold Hamm. Management of the two firms seems to be getting increasingly worried about obtaining sufficient votes for the buyout at the October 20 shareholder meeting, judging by the flurry of proxy solicitations that we have received. With the recent recovery in gas prices the acquisition looks priced too cheaply, and it is no wonder that shareholders are reluctant to support this bad deal.

Billionaire Harold Hamm controls Read the rest of this entry »

Chaparral Resources Litigation Update: Lukoil’s Settlement Payment Coming Soon

March 13, 2008

The settlement of the shareholder litigation after Lukoil (ticker: LUKOY) bought out the minority shareholders of Chaparral Resources, Inc. has been approved by the court this morning. We documented the litigation and Lukoil’s egregious behavior in September 2006, and wrote about the settlement this January.

The net settlement available for public shareholders should come to $1.80 per share. This represents a 31% increase over the price Lukoil paid minority shareholders and shows quite clearly the success, albeit temporary, of the oil giant’s attempts to depress Chaparral’s stock price. Eligible to receive it are only shareholders who held Chaparral stock at the closing of the merger in September 2006. Anyone who sold before the closing will not be eligible to receive a payment.

Claim forms must be received by the claims administrator by April 12. Payment should be made shortly thereafter, but the exact timing will depend on the number of claim forms that need processing.

Thomas Kirchner manages the Pennsylvania Avenue Event-Driven Fund (PAEDX), which owned shares in Chaparral Resources, Inc. through the closing of the merger.

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Chaparral Resources Shareholders Have Last Laugh As Lukoil Settles Litigation

January 22, 2008

LukoilOverseasRussian oil giant Lukoil’s (ticker: LUKOY) buyout of the minority shareholders of Chaparral Resources, Inc. has been marred by allegations of serious wrongdoing and fraud that came to light during discovery in shareholder litigation, which we wrote about in September 2006. More than one year later, Lukoil has agreed to settle the litigation by paying over $36 million to the former shareholders of Chaparral Resources. Read the rest of this entry »

Indemnification Conundrum In Solengo Capital’s Blind Pool

April 2, 2007

Amidst court orders against websites that leaked a confidential marketing brochure by hedge fund upstart Solengo Capital, the content of the formerly confidential brochure got lost in the brouhaha.

Solengo is the new hedge fund raised by Brian Hunter, who is the trader reportedly responsible for the multi-billion dollar loss suffered last year by hedge fund Amaranth in natural gas futures. He wants to get back into the business with a new fund only half a year after Amaranth’s near-meltdown. Thanks to this short road to redemption, it is no surprise that Hunter’s marketing materials have become the object of merciless mockery in the financial blogging community.

Read the rest of this entry »

Chaparral Resources Buyout Highlights Lukoil’s Questionable Tactics

September 18, 2006

LukoilOverseasRussian oil giant Lukoil’s attempt to buy out the minority shareholders of Chaparral Resources, Inc. (CHAR.OB) raises serious concerns about shareholder rights and the treatment of outside investors by the first Russian company to list on the London Stock Exchange — one that claims to be a model for openness and transparency.

Over the last few years, Lukoil, described by many observers as an extended arm of the Kremlin, has tried repeatedly to expand its operations in Kazakhstan, which it views as strategically important for its vast oil reserves. Last year, it lost the $4.2 billion takeover battle of Canadian PetroKazakhstan to the Chinese National Petroleum Company. Read the rest of this entry »