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The backlash is growing against Freeport McMoRan's (FCX) planned acquisition of two oil...

The backlash is growing against Freeport McMoRan's (FCX) planned acquisition of two oil explorers, as T. Rowe Price and Van Eck - who hold at least 9% of shares - say the tie-up is riddled with conflicts of interest. BlackRock's Evy Hambro, who ripped the deal early, continues to weigh in: He's most upset at the lack of a shareholder vote on a transaction that equals two-thirds of FCX's market cap.
Comments (13)
  • rjj1960
    , contributor
    Comments (1370) | Send Message
     
    Management gone wild...........very common. FCX had no business changing gears and spending , what 15 billion on these two energy companies haphazardly Same thing happens behind board room doors when it's time for the Christmas bonuses.
    11 Dec 2012, 06:28 PM Reply Like
  • k2caliguy
    , contributor
    Comments (59) | Send Message
     
    http://onforb.es/T6cYbv

     

    Here is further fuel to the fire from a Forbes Author regarding the timing of stock sales and the buddy network of board members at University of Texas.

     

    The transcript of Mcmoran's third quarter conference call also makes no sense by the CEO, the guy cannot talk at a high level like any normal ceo from any other s&p 500 company.

     

    It seems Mcmoran's has run out of cash drilling in gulf and now FCX's balance sheet has been leveraged for a select few board members to cash out.

     

    there are oil majors in the gulf performing technical deep water drilling, it is going to take more then FCX's little cash flow to unlock and find the estimated LNG gas that is 20,0000 and 30,000 feet below the sea level. FCX game plan for 2013 expansion of their copper mines is done, just trying to manage the capex for Mcmoran.

     

    That plan will have to pushed back becuase copper in the 4th quarter has been lower than the 3rd quarter, and mcmoran cash flow is getting killed by the inability to export LNG, and having to deal with a LNG price of under $4.00 thanks to the Shale gas plays.

     

    The dividend could be at risk in 2013.

     

    US contraction at a macro level for any fiscal cliff plan means china export slowdown to the US. That should slow chinese growth, which supports 60 percent of the world copper demand.

     

    There has to better small cap mining companies available? Why don't they diversify into Potash, the world continues to grow and farmers need it.

     

    I lost my shares on a 39 covered call earlier this year, I wanted to get back in the stock at the right price point, but this merger makes no sense, and for that I am out as Mark Cuban would say on shark tank.
    11 Dec 2012, 07:02 PM Reply Like
  • minwyhe
    , contributor
    Comments (103) | Send Message
     
    I do not know how to initiate a class action law suit, but from what I have read it is in order. I own stock and would support any action that takes place.
    11 Dec 2012, 07:55 PM Reply Like
  • Large Tentacles
    , contributor
    Comments (4) | Send Message
     
    Several law firms have already lined up....Google latest prnouncements.
    12 Dec 2012, 03:24 AM Reply Like
  • erikrosvold
    , contributor
    Comments (2) | Send Message
     
    Add me to the list of shareholders who want to vote. I can't understand why we wouldn't be able to vote or allow the CEO to have such a conflict of interest.
    12 Dec 2012, 03:21 AM Reply Like
  • erikrosvold
    , contributor
    Comments (2) | Send Message
     
    As a shareholder I feel cheated. Seems like we're bailing out MMR since they ran out of money on the Davey Jones site. We're doing it at a super premium of over 80% and that doesn't count the specialty royalty that might cost us another $10 which equal to another 150% premium. The CEOs all get $60 million plus each out of the deal. We don't even get to vote? This smells bad. I would feel better if management waived their bonuses over this as it seems like conflict of interest big time.
    12 Dec 2012, 03:26 AM Reply Like
  • User 266161
    , contributor
    Comment (1) | Send Message
     
    If they follow up with these acquisitions, the board will get sued for conflict of interest!
    12 Dec 2012, 03:31 AM Reply Like
  • Mferr
    , contributor
    Comments (2) | Send Message
     
    Same here , I would support any class action against this shameful deal
    12 Dec 2012, 03:46 AM Reply Like
  • karenastathis
    , contributor
    Comments (2) | Send Message
     
    I am not as upset about this as some are. Freeport C & G and McMoRan Ex used to be one company - Freeport-McMoRan back in the early days. They split off in the late 80s/early 90s. Freeport C& G is still the largest copper producer and I assume will continue to be so barring any outside influences. It's not like they are diversifying into an industry they know nothing about. I am looking at this as a buying opportunity.
    12 Dec 2012, 07:44 AM Reply Like
  • gdonelson
    , contributor
    Comments (36) | Send Message
     
    FCX did pretty well with the acquisition of Phelps Dodge. As I recall they reduced the acquisition debt to nearly zero in 2-3 years. Perhaps there just aren't any copper/gold projects which are large enough, with high quality ore in stable geographic regions that they feel comfortable purchasing. Hence the diversification into US O&G. Just a thought.
    12 Dec 2012, 10:01 AM Reply Like
  • BlueOkie
    , contributor
    Comments (5593) | Send Message
     
    This is the reason one should diversify investments. Ofcourse, when everyone hates the stock, it may be the time to buy.
    12 Dec 2012, 07:57 AM Reply Like
  • minwyhe
    , contributor
    Comments (103) | Send Message
     
    It would be interesting to see who the people are that made the last 3 comments. Any chance they are tied in some way to this venture either on FCX part or the companies being acquired.
    12 Dec 2012, 12:43 PM Reply Like
  • karenastathis
    , contributor
    Comments (2) | Send Message
     
    Lol,'tied in some way to this venture'? Not really, I owned Freeport-McMoran stock back in the 80s,sold it in the 90s. Since I am currently just a little, tiny investor I wouldn't say I was tied to it. I've always liked both companies and was just considering to start buying MMR when the announcement occured. Now, I'll just start buying more FCX, 10 shares at a time, lol.
    13 Dec 2012, 02:12 AM Reply Like
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