PEDEVCO Corp (PED) began pre-market trading on Thursday with high notes. The stock price started 85% higher than the previous closing price before start of the trading. It went up more than 100% at start of initial trading session.
All that happened after release of an open letter by the energy company to acquire SandRidge Permian Trust. The letter was addressed to The Bank of New York Mellon Trust Company, N.A and Avalon Energy, LLC. The former is the trustee of SandRidge as common unit holder of it. While the later, looks after the essential assets of Trust and is also a common unit holder.
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In its letter PEDEVCO offered them to fully acquire all common units of the Trust. The offer also includes acquisition of Trust’s key assets and right to operate it. SandRidge Permian Trust is enlisted at the NYSE under ticker “PER”. PEDEVCO suggested delisting of the Trust and liquidation of all of its assets within a year. PEDEVCO called the offer as a best way to safeguard the interest of all stakeholders of the Trust. But it emphasized that same could not be possible without having a positive dialogue. The letter stressed both companies to start discussing the offer with PEDEVCO.
PEDEVCO urged them to consider the issuance of its common stock against the deal as best way possible. The company thinks the deal as a way for current stakeholders to get a chance to own larger part of the Trust. It remained optimistic about future price of the new entity. PEDEVCO has a stronger financial position and also have knowledge of running Trust’s business. On the basis of same it thought itself a better match for the Trust to partner with.
PEDEVCO’s President J. Douglas Schick was confident that both stakeholders would take the proposal wisely and as a better opportunity.
PEDEVCO shares were up 200% at last check on Thursday while SandRidge Permian Trust was at 56% gain.
