Summary
Penn Virginia stock appears to be trading above the stock and cash portion of the offer as well as the all stock portion of the offer.
Denbury stock has dropped more than 75% from its highs.
Mangrove partners has a 10.7 percent stake and opposes the deal.
The deal does not enable Denbury to delever financially materially and is therefore a bet on rapid production growth and coninued strong oil prices.
The Eagle Ford wells of Penn Virginia are more profitable than the secondary recovery operations of Denbury Resources.
This idea was discussed in more depth with members of my private investing community, Oil & Gas Value Research. Start your free trial today »
Penn Virginia (OTC:PVAC) had announced that a merger with Denbury Resources (DNR) had been proposed. Since then the price of Denbury Resources has collapsed as shown:
Source: Seeking Alpha Website December 22, 2018
