Forest Oil: Strategic Challenges Are Not Over
Forest Oil: Strategic Challenges Remain
Richard Zeits • 12 Comments
Richard Zeits • 12 Comments
Nov. 17, 2014, 4:52 PM
- Forest Oil (NYSE:FST) +8.8% AH on news it agrees to sell its natural gas properties located in the Arkoma Basin to an unnamed buyer for ~$185M.
- The transaction is not related to FST's pending merger with Sabine Oil & Gas, and Sabine has given its consent to the sale; FST has scheduled the special shareholder meeting for Nov. 20 to vote on the proposed combination.
Oct. 27, 2014, 12:49 PM
Oct. 22, 2014, 12:47 PM
Oct. 3, 2014, 9:10 AM
Aug. 12, 2014, 7:46 AM
- Forest Oil (NYSE:FST) -5% premarket after disclosing it will need more time to file its 10-Q form after identifying "material weaknesses" in its internal controls.
- FST says it does not believe the material weaknesses resulted in a misstatement of its financial statements on Form 10-K for last year, but says it is auditing the procedures.
- FST warns the review may change the results included in its Q2 earnings report issued yesterday, in which EPS and revenues failed to meet Wall Street expectations.
Jul. 25, 2014, 5:37 PM
Jul. 10, 2014, 9:41 AM
- Forest Oil (FST -2.1%) and Sabine Oil & Gas revise the terms of their merger agreement so that Sabine will now be acquired by FST, rather than FST merging with a Sabine unit.
- FST also adopts a shareholder rights plan, with a 5% trigger on shareholders who have shorted the company's debt; FST says it is concerned that investors with short positions in its debt securities could attempt to negatively influence or manipulate the merger vote in an effort to drive down debt prices.
- The revised structure does not alter the economic terms of the all-stock transaction; when the deal is completed, current FST shareholders will own ~26.5% of the combined business, the same as under the original contract.
Jun. 17, 2014, 12:50 PM
Jun. 17, 2014, 9:18 AM
Jun. 17, 2014, 8:30 AM
- Forest Oil (FST) +18.9% premarket as Sabine Oil & Gas says committed financing is fully in place for its acquisition of the company.
- Sabine CEO David Sambrooks refutes yesterday's report that the $850M bridge financing facility was pulled, and says the financing commitment needed for the transaction with FST remains in place and unchanged.
May 6, 2014, 12:45 PM
May 6, 2014, 9:11 AM
May 6, 2014, 8:49 AM
- Forest Oil (FST) +40.2% premarket after agreeing to merge with Sabine Oil & Gas in an all-stock transaction that will create one of the industry's largest east Texas players.
- The combined company will have estimated proved reserves of 1.5T cfe (71% gas) and estimated daily production of 345M cfe (65% gas) for 2014.
- Sabine unitholders will own ~73.5% of the new combined entity and FST shareholders will own ~26.5%; the combined entity will be named Sabine Oil & Gas Corp. and be run by Sabine's current executive management team.
- For FST, the merger is more like a rescue, as shares have dropped 50% YTD.
Mar. 6, 2014, 2:22 PM
- Forest Oil (FST -2.9%) shares slump after Moody's downgrades the company's credit rating to BBB with a negative outlook, citing the reallocation of capital away from Eagle Ford drilling which will result in lower oil production than previously expected and thus lower cash flow and higher leverage.
- Separately, Barclays cuts its FST target price to $1.50 due to weaker FY 2015 oil production estimates; FST revealed difficulties with several wells in the Eagle Ford shale in its Q4 results, causing it to lower its type curve assumptions and slow drilling activity until it further processed seismic data (Briefing.com).
Feb. 26, 2014, 12:46 PM
Feb. 26, 2014, 10:48 AM
- Forest Oil (FST -38%) plunges after Q4 earnings and revenues came in below expectations and disappointing Eagle Ford results which further call into question FST's asset quality.
- Q4 average net sales volume totaled 164.7M cfe, down 47% Y/Y; average realized prices for gas and oil, including realized derivative gains, were $3.59 and $90.16, respectively, vs. $3.83 and $96.25 in the year-ago period.
- Year-end 2013 estimated proved reserves were 625B cfe vs. 1,363B cfe at the end of 2012, mostly the result of 800B cfe of asset sales.
- Wells Fargo downgrades shares to Market Perform from Outperform following FST's move to defer 2014 Eagle Ford activity as the company reprocesses existing 3D seismic surveys: "Combined with weaker well results, not what we, nor the Street, wanted to see."
- Goldman Sachs reiterates its Sell rating and cuts its price target to $2.50 from $4, citing heightened risk in FST's acreage position, which is "the key asset for the company."
Forest Oil Corp is an independent oil and gas company engaged in the acquisition, exploration, development, and production of natural gas and liquids in North America.
Sector: Basic Materials
Industry: Independent Oil & Gas
Country: United States
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