SOLD! Harvest Natural Resources Pays 64% In 26 Days

Oct 07

SOLD! Harvest Natural Resources Pays 64% In 26 Days

As expected, thankfully, Harvest Natural Resources (HNR, NYSE) announced this morning that it has sold all of its Venezuelan Oil interests.

Time to lock in profits!




As I outlined September 3, the buyer, billionaire Oswaldo Cisneros, made all the difference in this deal.

Here’s an excerpt from the news release:

“At the closing, Harvest received $80 million in cash, a $12 million 6-month 11% note payable to Harvest by the purchaser, and cancellation of $30 million in debt owed by Harvest to CT EnergyHarvest used part of this cash consideration to pay the remaining debt it owed to CT Energy and for other expenses and adjustments associated with the transaction.  Net cash proceeds received after paying the above closing adjustments and other expenses was $69.4 million.  Also at the closing, CT Energy relinquished its 8,667,597 shares of Harvest common stock, which will be held as treasury shares, and agreed to terminate the warrant, issued in June 2015, to purchase up to an additional 34,070,820 shares of Harvest common stock.  With the return of the shares held by CT Energy, Harvest now has 44,318,567 outstanding shares.

“After receiving payment of the purchaser’s note payable of $12.0 million less taxes, funding a reserve for potential change of control payments and working capital, the estimated cash remaining is expected to be $62 million.  Upon the potential exercise of vested options held by employees, the estimated outstanding shares of Harvest common stock is expected to be 48,693,768 shares.

“Going forward, Harvest’s primary tangible asset is its Oil and gas interests in Gabon.  Harvest has received two proposals for the purchase of its Gabon interests and is in discussions with both potential buyers; however, there can be no assurances that these discussions or either proposal may lead to a definitive transaction.”

HNR has traded as high as $1.04 this morning. Its cash position represents $1.27 per share.


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