QEP Update Following The Failed VEAC Deal -- February 28, 2019

QEP today:

News article, link here:

Colorado-based QEP Resources Inc.'s board of directors started a comprehensive review of alternatives to maximize shareholder value, which may result in a merger or divestment of the company.

The company will be in talks with the fund manager Elliott Management Corp. and other unnamed companies interested in a potential deal, according to a Feb. 20 news release. In January, Elliott offered to acquire the entire company at $8.75 per share in cash.

QEP:

• 236 million shares outstanding x $9 = $2.1 billion
• currently trading at about $7.75
• market cap: $1.82 billion
• enterprise value: $4.37 billion
• total debt: $2.51 billion
• cash: $0 
• Bakken: 2.5 million bbls crude oil over three months = $0.5 billion annually
• Permian: 5 million bbls crude oil over three months = $1 billion annually

The Permian:

• 50,000 acres
• at $20,000 / acre worth at least $1 billion

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Disclaimer: I often make simple arithmetic errors; I often misread things. I have no degree in finance. I have formal education or experience in the oil and gas market. I do have experience pumping my own gasoline at the local service station.