mmasters wrote:I think it was all about needing the appropriate funding. When oil was low they were struggling financially so they came up with this as a way to get money in advance. Now that the price of oil is trending higher they're better off and feel they don't need to go down this path.
I'll buy that, and that was one of my first thoughts.
OTOH, that's short term thinking, and as a strategy it's likely to have VERY BAD results.
Strategically, the time to do such an IPO would be when prices are looking quite high. They get good value that way, and worst case, if prices go MUCH higher, they can sell another chunk if they wish. (This is one of my favorite strategies in the stock market. It requires patience in the timeframe of decades, though).
However, if whenever times get tough, they look at raising short term cash as a mitigation strategy, they get very poor value.
Given the way most corporations and many governments and, by far, most individuals operate, that might be happening. But again, as a strategy, it would be really stupid.
And as volatile as oil and geopolitical events are, I believe that assuming oil prices can only trend higher than here is quite risky. Currently that looks like a good bet -- but MANY things can change. One would be a meaningful, normal, economic downturn, given how long the US bull market has been this cycle.