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If you are buying PTTEP to secure the right to buy the 142 baht stock as a long term investment you are making the right move, if you are trying to trade it up on the demand from people trying to secure rights, then be fast and exit soon.

Thailand’s largest ever stock offering is about to get under way and the rules are simple, a total of 650 million ordinary shares will be issued and allotted on a preferential public offering basis to eligible shareholders. The entitlement ratio is one existing ordinary share to 0.195783 newly issued ordinary shares this coming Monday-Wednesday the price is 142baht.

After that offer closes expect the market to sell off, probably back to the 150-156 range, double click below to see Chart.

PTTEP Live Trading News Macro Charts

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Linda Johnson,
Business Development Director – Private Client Group,
Heffernan Capital Management
Sales@Heffcap.com

Singapore

3 Raffles Place #07-01
Bharat Building Singapore 048617
Tel: +65 6329 6408
Fax: +65 6329 9699

Economist and Hedge Fund Manager Shayne Heffernan of www.livetradingnews.com takes a look at PTTEP & Cove Energy.

Long term PTT Exploration and Production Plc (PTTEP) remains a Shayne Heffernan Must Own Equity.  PTTEP and the 2015 price target remains 300Baht, currently valued at over US$20 billion and 65 percent-owned by its parent PTT, is among Asia’s top 10 explorers, competing with big Chinese oil firms such as CNOOC (HKG:0883) and Sinopec (HKG:0386), and has set an aggressive M&A plan that will make it one of the world’s largest energy companies by 2020.

PTTEP is on the right track, Thailand needs energy as does ASEAN, Prime Minister Yingluck Shinawatra is urging the US government to assist in supplying liquefied natural gas (LNG) to Thailand, during US President Barack Obama’s visit last month, Ms Yingluck asked the US to sign an agreement with Thailand on supplying 2.5 million tonnes a year of LNG over 20 years. There has not been a definite response from the US.

PTTEP is responding to a national and regional need for long term energy, and it will be a big winner over the next 10 years.

PTT Exploration and Production Plc (PTTEP), Thailand’s only Oil and Gas explorer, has finalized a deal to purchase the London-based Cove Energy Plc.

PTTEP recently issued $500 million of 30-year bonds and demand exceeded the offer amount by 5-6 times, reflected strong confidence in the company.

PTTEP plans to invest $2.6 billion in Southeast Asia over the next five years, mainly in Myanmar, and is on track to triple its production to 900,000 barrels per day by 2020.

“We will invest more than $2 billion in Myanmar, mainly in Zawtika and exploration in deep-sea fields, which needs a lot of money,” CEO Tevin Vongvanich has said.

Cove Energy would play a major role in helping PTTEP achieve its production target and boost petroleum reserves to more than 10 years.

PTTEP, a subsidiary of the national oil conglomerate PTT, defended its 1.12-billion (53.9 billion baht) bid to acquire Cove Energy, the UK-based petroleum exploration and production firm, saying Cove’s assets are of international standard and the potential is high for discovering a large amount of gas.

Anon Sirisaengtaksin, PTTEP’s president and chief executive, said Cove just finished its exploration of a gas field in Mozambique and found reserves of about 30 trillion cubic feet.

A majority of Cove Energy’s shareholders have accepted PTTEP’s offer to acquire the firm.

Tevin Vongvanich, PTTEP’s president and chief executive, said Cove shareholders who collectively own 91.37% of the company have accepted a cash offer by PTTEP Africa Investment Co, a wholly owned subsidiary of PTTEP.

PPTEP, expects to raise 92.3 billion baht in the country’s largest-ever equity offering.

The unit of energy giant PTT Plc will sell shares at 142 baht each as determined via a book-building process against a Thursday close of 154 baht, Tevin Vongvanich, the president and chief executive, said yesterday in a press release.

PTT, which owns 65% of PTTEP, will subscribe to its full entitlement of shares at the top end of the price range.

“The final offering price reflects current market demand for PTTEP’s newly issued ordinary shares,” said Mr Tevin.

“We’ve received positive responses from our management roadshow in which we met with investors in Thailand, Singapore, Hong Kong and the US.”

He said to ensure transparency, PTT did not participate in the book-building process that determined the final offering price.

But it has pledged support for the capital increase and is committed to subscribing fully in order to maintain its shareholding.

This transaction will be the biggest public offering in Thailand to date, Mr Tevin said. The equity rise will enable PTTEP to strengthen its capital structure and achieve its growth plans.

The recapitalisation marks a crucial point for PTTEP in financing its future growth and the recent acquisition in Cove Energy.

The firm is banking on foreign acquisitions to achieve its aim of doubling production volume to 600,000 barrels of oil equivalent per day by 2020. In July, it outbid Royal Dutch Shell for Cove Energy in a US$1.9-billion deal.

Shares of PTTEP closed yesterday on the SET at 159 baht, up five baht, in heavy trade worth 2.58 billion baht.