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question about Premier Oil Bonds?

Gilts, bonds, and interest-bearing shares
Shinyuk
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Re: question about Premier Oil Bonds?

#151404

Postby Shinyuk » July 10th, 2018, 10:23 am

hiriskpaul wrote:
Alaric wrote:Unless there's a conversion on the bonds that's "in the money", there's no particular likelihood that a jump in the price of ordinary shares would have the same effect on bonds. Are Premier Oil bonds less risky than yesterday?

Not as far as I can tell, but I cannot see why the ords are worth 10% more than yesterday either. No company announcements for example. These are high yield bonds and as such good news is usually good for ords and bonds, but yes better for ords.

Enquest up a lot as well, but again not the bonds.

RBC upgraded the shares to ‘top pick’ yesterday. May have something to with it. Would be good if some of this positive news flow drove up the bond price but ultimately it’s about reducing the debt pile so awaiting further announcements.

hiriskpaul
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Re: question about Premier Oil Bonds?

#151478

Postby hiriskpaul » July 10th, 2018, 2:34 pm

Shinyuk wrote:
hiriskpaul wrote:
Alaric wrote:Unless there's a conversion on the bonds that's "in the money", there's no particular likelihood that a jump in the price of ordinary shares would have the same effect on bonds. Are Premier Oil bonds less risky than yesterday?

Not as far as I can tell, but I cannot see why the ords are worth 10% more than yesterday either. No company announcements for example. These are high yield bonds and as such good news is usually good for ords and bonds, but yes better for ords.

Enquest up a lot as well, but again not the bonds.

RBC upgraded the shares to ‘top pick’ yesterday. May have something to with it. Would be good if some of this positive news flow drove up the bond price but ultimately it’s about reducing the debt pile so awaiting further announcements.

Thanks, I thought it might be a broker rec. Up another 3% today, so the intrinsic price of the warrants is up to 90p, or around 20 times* the price they were issued at. They are turning into a nice little bonus.

The last announcement was quite upbeat:

https://www.londonstockexchange.com/exc ... 42637.html

We should see some significant debt reduction this year, assuming the oil price holds up and we don't hit some major operational issues.


*edit: sorry, make that 6.5 times!

hiriskpaul
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Re: question about Premier Oil Bonds?

#151980

Postby hiriskpaul » July 12th, 2018, 2:05 pm

Latest update: https://www.londonstockexchange.com/exc ... 14727.html

No material changes over previous update, which is good news as far as I am concerned. Bond prices unchanged, share price down, mostly likely due to the large fall in price of oil yesterday.

I received an on-line quote of 101.1 for 10k PMO1, putting the ytm at 6.18%. I am perfectly happy to continue to hold at that price.


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