Vantage Energy Services (VTG)

Allstar13913 (99.88) Submitted: 4/12/08 1:03 PM : Start Price: $7.70 VTG Score: 44.03

This is an SPAC, an aquisition company in search of a product. This company has decided on buying 4 oil rigs and deploying them. I despise SPACs because they give 20% of equity in the acquired company to management, at the expense of shareholders. This is bad for fools.





The company is also circulating misleading presenation materials claiming their cash flow multiple is 2 compared to other companies in their industry at 12. The following fool article, Top Secret Energy Plays, debunks that myth:


http://www.fool.com/investing/high-growth/2008/04/04/top-secret-energy-plays.aspx





From the article:


All of these rigs are being built on spec. There are no contracts attached, and it's up to Vantage to secure work in advance of the rig deliveries.





At the helm of Vantage Energy is Paul Bragg, a former Pride International chief executive. In 2005, Pride's board showed Bragg the door after years of botched construction programs and other disappointments. It was an ugly split, with the suddenly former CEO suing for breach of contract, and Pride countersuing for breach of fiduciary duty.


--------------


I don't trust a company that is misleading and puts the needs of executive ahead of shareholders. This company is definately going down...

Report this Post Replies: 1 | Reply