Josh Young
Hedge fund manager, energy, value, special situations

Baytex Bids To Buy Out Aurora Oil: Investment Implications

On February 6th, Baytex (NYSE:BTE) offered to buy out Aurora Oil (OTCPK:AAGLF) for total consideration of $2.6 billion (NYSEARCA:CAD), or $3.67 per share net of debt (NYSEARCA:USD). Aurora traded up from $2.30 per share to $3.70 per share, perhaps in anticipation of a potentially higher bid.

Baytex shared some of the metrics it is paying for Aurora in a press release, perhaps providing some indication of the logic for the buyout. This could help in assessing potential higher bids by other companies for Aurora. It could also help assess the acquisition criteria of acquisitive companies like Baytex. And perhaps it allows for read-through to other potentially undervalued small cap oil and...

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