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Halcon Resources announces filing of shelf registration

  • Halcon Resources (HK) -1.8% AH after filing for a ~158M-share common stock offering by selling shareholders.
  • HK is not selling any shares and will not receive any of the proceeds from the sale.
Comments (8)
  • jacksalmon
    , contributor
    Comments (306) | Send Message
    Can someone please explain what this is? Why would the company arrange for the sale of shares that could be sold in the market? Or, are these shares held by shareholders which are not capable of being sold in the market? If so, what kind of message is being sent when these shareholders who are prohibited from selling in the market are using the company to get rid of their shares? As you can see, I am totally ignorant of what this selling device is and represents, so any help would be appreciated to aid my understanding. Thanks.
    27 Sep 2013, 05:02 PM Reply Like
  • jfsmart
    , contributor
    Comments (291) | Send Message
    Where principals in a company or outside investors have a large stock position, their purchase and sale activities must be filed with the SEC. It's a watch dog policy that assures there is no insider trading taking place.


    Oftentimes, and this may not be one of those instances, but by way of example, where executives have options that they can exercise, but don't have the actual money it takes to purchase the shares, they can exercise and sell in the market simultaneously. In this case, rather than just selling the stock in the market, there may have been several that joined together and may sell a small block to an interested investor or fund. The above disclosure is simply saying that the sale of stock being registered is not a company stock sale that issues additional shares to raise capital. There is no dilution in company stock as a result of this transaction. Hope that helps... jf
    27 Sep 2013, 05:36 PM Reply Like
  • sower001
    , contributor
    Comments (8) | Send Message
    The only problem is the dilution of equity in stockholder holdings in the balance sheet and then the question arises as to why they want to sell their position
    29 Sep 2013, 12:01 PM Reply Like
  • wharfrat1940
    , contributor
    Comments (21) | Send Message
    jfsmart, Thanks for the explanation as I was completely confused by the way the announcement was worded.


    Is anybody a buyer at these low low prices for HK? It is sitting right at the 52 week low.


    The other E&P operators in the Bakkens are hitting new 52 week highs and KOG closed today at an all time closing high of $11.94 with the high for the day of $12.22
    27 Sep 2013, 06:48 PM Reply Like
  • Brett22
    , contributor
    Comments (83) | Send Message
    You may want to read this. There is no cashless option exercise and NO insiders are selling. This is a common and required process when large holders want to be able to sell restricted shares in the future. Usually done when the restricted holders expect the stock to improve in value in the future and they want to be able to reduce their position at that point rather than file the S-3 then and wait to sell later.

    28 Sep 2013, 07:51 AM Reply Like
    , contributor
    Comments (3) | Send Message
    Great explanation of the mechanical aspect of this registration and spot on in accuracy. My issue is the, regardless of right or wrong, psychological damage/impact of yet another registration on the heels of the secondary offering. Again, Floyd is a smart cat and I will bet on him, but there is no denying this stock is like a boxer waiting to get hit again and is covered up in the corner. Management does not owe shareholders anything other than their best effort at fiduciary responsibility. It is time for a B-12 shot of good news (discovery- acreage prove up- new analyst rec- etc.). Halcon is in virtually every stellar 'hot lease' in North America and that speaks well of the team. We just need some good news and we could use it now.
    28 Sep 2013, 12:27 PM Reply Like
  • Brett22
    , contributor
    Comments (83) | Send Message
    Could not agree more. I'm VERY long and not concerned about short term price. However, would it hurt Floyd and the Board to work with large holders and make sure that nothing is done optically to further depress the stock. Kind of surprised to see an S-3 but the optimist in me says it may lead uneducated, weak hands to sell next week and I'll add to position cheaper.
    28 Sep 2013, 12:43 PM Reply Like
  • jfsmart
    , contributor
    Comments (291) | Send Message
    About half of the 360 mil shr float has traded over the past 30-40 days, so, that tells me that there is lots of buying going on ( for every seller, there's a buyer) creating a pretty good base being built with most of that volume appearing to be consolidated in a 30 cent price range of $4.60-4.90.


    I again added to my April 2014 $4 Call positions this week paying only a 50 cent premium. The next two earnings reports should provide a great deal of positive news as drilling sweet spots is living up to high expectations in the Bakken.
    28 Sep 2013, 03:38 PM Reply Like
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