Another newcomer to the main market...anybody any idea what the production figures are ?

So a company wants to buy Heritage, it gets HOIL to say it wants to acquire itself......this is all very confusing and we could see more dramatic ups and downs if the sp is unfrozen !.

DJ Update 3

" Ambrian analyst Werner Riding said potential suitors could include Norway's DNO International ASA (DNO.OL) or Canada's Addax Petroleum Corp. (AXC.TO). Both have assets in Kurdistan, and Addax also operates in Africa, he said. Neither company could immediately be reached for comment.

Riding said he wasn't surprised by news of merger talks. "One of the key investment rationales for Heritage was the possibility of a takeover down the line because of the quality of its assets," he said.

Panmure Gordon & Co. analyst Peter Hitchens agreed, saying Heritage's assets in Uganda and Kurdistan are "world class" and would be attractive to a major oil company.

Heritage said in May it was reviewing options to fast-track development and start production in Uganda as soon as possible. It said it had been approached by a number of parties interested in financing the needed infrastructure. Options included a development using an existing railway in east Africa, a 1,200 kilometer pipeline to Mombassa, Kenya and a refinery.

China National Petroleum Corp. and China Petroleum and Chemical Corp. (600028.SH), also known as Sinopec, have shown an interest in joining the Uganda project, a person familiar with the matter told Dow Jones Newswires last month, and there has been speculation they or other Chinese firms like PetroChina Co. Ltd. (601857.SH) might be interested in acquiring Heritage or its assets.

Hitchens said a Chinese company would be more likely to simply make a straight offer if it wanted to acquire Heritage, so a merger classed as a reverse takeover suggested it was someone else.

Malcolm Graham-Wood, director at brokerage HansonWesthouse, said Middle Eastern sovereign wealth funds might also be interested in Heritage and its assets."

NB, one other report touts 7 to 8 per share take out value.

the more in the melting pot the better .... anyway, should more than than compensate for my dumb call on WOS!

in a word DOH!!! a profit is a profit but a big profit is always better.

Be gentle with cynic first thing in the morning..:))

you're right .... i respond well to a gentle fondle and some tlc!

7 to 8 seems a bit mean especially when brokers were calling this one up to between 10 and 14 only about a month ago on the good news re ... find.

Any thoughts cyners fellow thread posters??.

Heritage might turn the first offer down.

my guess would be closer to 10 than 8, but that is pure greed and without true logic ...... however, there is no denying that HOIL has some first-class assets both in quality and quantum which will be of considerable interest to a number of large fish ..... unless the first offer comes in at a k/o price, a bid battle could esily ensue

but we shall just have to wait and see as there is no trading to be done

There has been trading in Cananda funnily enough, closed at 6.59 if my info is correct.

Tony Buckingham is just as likely to turn down any silly offer that does not reflect true value, he is the majority shareholder and has done it a few times before.

My guess is well north of 10.



1.00 CAD = 0.551716 GBP

Well Im hoping you chaps are right.

Got a few dogs in the portfolio today.

One for you to chew on cyners......

Excellent post on i.i.i by JK Silverstone. Hanson Westhouse have a valuation of 890p - excluding any takeover premium:

http://www.iii.co.uk/investment/detail/?display=discussion&code=cotn%3ANMX0530.L&threshold=0&pageno=3&it=li

"Our note on Heritage Oil has been overtaken by events. Whilst we intended to reiterate our BUY recommendation, events today, when the company asked for its shares to be suspended due to discussions with a third party regarding a possible reverse takeover, have made a Buy un-actionable.

Yet there are no guarantees regarding the outcome of current discussions, as such we believe there is merit in releasing our note illustrating the value we believe resides within Heritage and which will still be of interest to potential buyers of the company in the weeks ahead as events unfold.

Key Financial data
Year Revenue Operating Income EPS
2007 $3.7m -$49.6m -$0.16
2008 $5.1m -$37.6m -$0.37
2009E $8.4m -$46.4m -$0.15
2010E $153.5m $4.8m $0.02
Market Cap 1,482m EV/Bbl1 22.74

Heritage produced a mere 450 barrels of oil per day last year and yet the market cap stood at nearly 1.5bn prior to the suspension of shares on 3 June. As the table above suggests, this value is not based on current operational status, rather it is the huge potential upside in Uganda and the
Kurdistan Region of Iraq. On a sum of the parts valuation of the groups asset base, we value Heritage at 890p per share.

Heritage has enjoyed exceptional success in drilling campaigns in Uganda and the Kurdistan Region of Iraq. So much so, that we anticipate the groups interests will yield implied recoverable reserves in excess of 2 billion barrels.

In our view, these resources will prove to be too enticing for either a national oil company or an international oil company (IOC) to resist. While yesterdays events have not taken the exact shape we anticipated, corporate activity involving Heritage was in our view inevitable given a litany of reasons not least of which are:
the move away from exploration to capital intensive development,
a track record of realising value through asset sales,
the large scale of its discoveries and
the need for IOCs to replace resources when access to new exploration areas is limited.

Although Heritages share price has been a strong performer in 2009, we believe that there is significant additional upside. What follows is our analysis to arrive at this conclusion and our target sum of the parts valuation of 890p per share. This does not include any premium in the event of a still possible corporate takeover, which we would expect
to be significant.
.....

Conclusion

In all, the rationale behind a takeover is compelling but that does not necessarily mean that one will happen. The problem for any buyer, in our view, will be to offer a price that Heritage would find acceptable.

The bottom line is Heritage can afford to wait. Funds on hand adequately support financial commitments over the next twelve months. Subsequent to this period, we believe that Heritage would have little difficulty in raising additional funding should the need arise.

Yet the longer a buyer takes to arrive the more time Heritage has to drill and evaluate its growing volume of data in relation to existing asset discoveries. This will in our view inevitably lead to resources being
upgraded and assigned a higher valuation per barrel as well as increasing the total amount of resources a potential buyer will need to factor into its acquisition price. As such, Heritage will clearly feel very confident should talks leading to a takeover begin.

Interested parties will no doubt be aware of this dynamic, which makes the likelihood of a substantial premium in our view a very high probability as well as the need to act quickly. By acting now, a potential buyer will at least benefit from residual weakness in the sector driven by short term oil price weakness."

now go post haste to DGO thread!

ok .... so here's some more light on this subject courtesy of Reuters ...... hmm! make of it what you will ......

* Genel Enerji in merger talks with Heritage Oil
* Focus on Kurdish oil field
(Reuters) - Unlisted Turkish Energy company Genel Enerji is the unnamed party in merger talks with British oil explorer Heritage Oil , sources close to the situation said on Thursday.

HOIL has two main assets - stakes in oil blocks in Uganda and Iraq's semi-autonomous Kurdistan region where discoveries, potentially containing billions of barrels of oil, have been made.

The tie-up talks with Genel Enerji, which is part of the Cukurova Group, one of Turkey's largest industrial conglomerates, are centered on Heritage's Miran field in Kurdistan, the sources said .... "Iraq is the focus," one source said.

Rather than buy out Heritage shareholders, Genel would contribute assets to the enlarged entity, one of the sources, who spoke on condition of anonymity, said.

The talks could prompt a bidding battle for Heritage but industry sources said there was a limited field of potential acquirers.

The government in Baghdad has described the oil deals signed by the Kurdish Regional Government as illegal and anyone investing there is effectively blocked from investing in the rest of Iraq.

Chinese state-owned oil companies which have been major buyers of oil assets internationally in recent years, are actively bidding for contracts in Iraq, as are the Western oil majors, making it unlikely they will shift their focus to Kurdistan.

Privately-owned French oil company Perenco, whose name has been linked with Heritage in the press, is not interested in buying the company, industry sources said.

Heritage's shares have soared in recent months, on the back of a major oil find at Miran ..... However, some industry executives believe investors have become too optimistic about Miran given the estimate of oil in place of up to 4.2 billion barrels was based on the results of just one well.

Times quote:
TURKISH GROUP IS HERITAGE TIE-UP TARGET

Turkey's Genel Enerji has been revealed as the unnamed company engaged in merger negotiations with Heritage Oil. Ever since the London-listed group announced on Wednesday it was in talks about a merger that was to be treated as a reverse takeover, speculation on the possible partner has been rife. According to the source close to the discussions, Genel would contribute assets to the enlarged entity rather than buying shareholders out. The person added that if a deal is completed, it could be announced by the middle of next week.

provided i make a decent profit, i am not much fussed ..... one could have argued that IEC were sold too cheap, but certainly ONGC reckoned they had to pay too much

10% profit? go on cynic and hold a share for a whole week, lol

dont have this in all seriousness......what happens now with it........do they come back relisted at much higher price

i don't know ... we'll just have to wait and see

Trading was resumed on TSX yesterday at 12:47. It closed at C$12.28 = 692p .

http://www.stockhouse.com/tools/?page=%2FfinancialTools%2Fsn...


higher higher higher higher..... you little barsteward.