BOE could fetch +$250 million in a sale

BOE could fetch +$250 million in a sale

America’s Petrogas (BOE:TSX) announced that it is under ‘strategic review’ (aka it has put up the 'for sale' sign).  Shares closed up $0.12 per share (12.5%) to $1.08 on 2.9 million shares bringing the company’s value to $200 million which, after a premium, could fetch $250-$350 million for the whole company.

Depending on how this sale goes, this could be the beginning of a consolidation phase in the Latin American junior oil and gas space.  The mid-caps are receiving a bit more warmth than their sub-10,000bpd junior counter-parts and so the valuation difference may lend itself to a consolidation wave.  Parex buying Petroamerica to consolidate their highly successful Los Ocarros Block in Colombia would make sense given Parex shares are up, almost 50%, over the last few months.

Here’s the release: Americas Petrogas Announces Strategic Review