Seeking Alpha

OGX Petroleo tumbles on debt swap, Petronas backtracking, cash crunch

  • Shares of OGX Petroleo (OGXPY.PK -14.2%) are plummeting on reports that OGX's beleaguered controlling shareholder,  Eike Batista, will swap $3.6B in bonds for equity and give up his controlling position in the company.
  • OGX's $850M deal to sell a stake in its Tubarao Martelo field to Malaysian Petronas has started to crack. As the field fails to live up to expectations, Petronas is attempting to back out of the deal, a move OGX insists it "no right" to before OGX completes its restructuring.
  • Although the debt conversion would dilute shareholders, it may be the only option to ease OGX's cash crunch. Analysts speculate the company may run out of cash before year end because of interest payments and drilling costs.
  • Shares are down 32.3% this week.
Comments (0)
Be the first to comment
DJIA (DIA) S&P 500 (SPY)
ETF Tools
Find the right ETFs for your portfolio:
Seeking Alpha's new ETF Hub
ETF Investment Guide:
Table of Contents | One Page Summary
Read about different ETF Asset Classes:
ETF Selector

Next headline on your portfolio: