A roundup of some of the North American equities making moves in both directions today
On the rise
Crescent Point Energy Corp. (CPG-T) was up 6.4 per cent after announcing on Tuesday it has agreed to divest its Uinta Basin assets and parts of its assets in Saskatchewan for a total of about $912-million.
The Canadian oil and gas producer said it is selling the Uinta Basin asset, which was put up for sale in the first quarter, to a private operator for about $700-million in cash.
In a research note, Raymond James analyst Christopher Cox said: “In addition to being accretive to the company’s current valuation, the transaction noticeably improves the strength of the company’s balance sheet, as well as the go-forward FCF potential of the company. This should all resonate with investors in today’senvironment, with the potential for additional asset sales bringing the company’s leverage position much closer to what investors are looking for in E&P companies today.”
Eldorado has two operating mines and two development projects in northern Greece but has struggled with permit delays at one location, Skouries, for years.
The energy ministry said on Monday it would fully conform with rulings by the country’s top administrative court. A ministry official told Reuters the rulings concerned permits for the installation of equipment for an enrichment plant in Skouries.
Score Media and Gaming Inc. (SCR-X) rose 11 per cent after it announced that a fund managed and controlled by Fengate Asset Management will invest $40-million in theScore to fund the growth and development of the company’s media and sports betting businesses.
Under the terms of the agreement, Fengate will purchase a $40-million, 8 per cent convertible unsecured subordinated debenture of the company, due Aug. 31, 2024. The private placement of the debenture is expected to close on or about Sept. 5, the company stated.
Osisko Gold Royalties Ltd. (OR-T) increased 2.2 per cent after announcing that its wholly owned subsidiary Osisko Bermuda Ltd. has entered into a definitive agreement with Mantos Copper S.A. to enhance its existing Silver Purchase Agreement with respect to 100 per cent of the silver produced from the Mantos Blancos copper mine located in Chile.
“Osisko is pleased to continue to build on its partnership with Mantos Copper and help finance the expansion of the Mantos Blancos mine," said CEO Sean Roosen. "Mantos Blancos is a long-life asset operated by a high-quality team with a proven track record operating in South America. This transaction is expected to be immediately accretive to Osisko’s cash flow per share and follows Osisko’s strategy of strengthening its portfolio through investment in high-quality projects in top tier jurisdictions.”
Enbridge Inc. (ENB-T) rose 0.2 per cent after Friday’s announcement that it has reached an agreement with shippers to place the Canadian portion of the Line 3 replacement pipeline into service by the end of this year.
It plans to file a tariff with the Canadian energy regulator for a temporary surcharge with a proposed effective date of Dec. 1, 2019, the pipeline operator said in a statement.
RBC Dominion Securities analyst Robert Kwan said: “We see this as a positive near-term development for investors that have patiently held the shares. We continue to view the stock as a solid choice for patient investors given: (1) the attractive 6.5% dividend yield that we expect to grow 10% for 2020 and 5-7% thereafter; (2) roughly 4.5x debt/ EBITDA with a fully-funded capital plan including the U.S. portion of L3R; (3) no expected common equity needs including the DRIP being turned off (i.e., not being diluted away waiting for U.S. L3R); and (4) the stock trading close to 15-year lows on a P/E basis.”
Bausch Health Companies Inc. (BHC-T) was 1.4 per cent higher after it announced early Tuesday that it plans to reduce its debt by approximately $200-million through the prepayment of senior secured term loans and the redemption of outstanding senior notes, using cash flow from operations.
The Laval, Que.-based company said it put in notice to prepay approximately $100-million of its senior secured term loans this week. After this prepayment, the company will have no further mandatory amortization payments until 2021.
On the decline
Hudson’s Bay Co. (HBC-T) was 1.1 per cent lower after Dutch business daily Financieel Dagblad reported on Saturday the retailer plans to close its Dutch stores by the end of 2019, laying off some 1,400 employees.
WSP Global Inc. (WSP-T) was down 1.7 per cent following the premarket announcement that it has acquired Orbicon A/S, a 500-employee Danish environmental consulting firm with additional offering in Supply & Infrastructure and Building.
Desjardins Securities analyst Benoit Poirier said: “Overall, we believe the addition of Orbicon reaffirms management’s ability to derive incremental growth from the acquisition and integration of specialized firms that not only deepen WSP’s existing client relationships but also provide opportunities for revenue synergies across its larger platform. We also like the business diversification in the attractive environmental segment and the geographic expansion in Denmark (WSP currently has 30 employees in the country). From a balance sheet standpoint, we do not expect the acquisition to materially affect WSP’s leverage ratio (net debt/EBITDA was 1.7 times in 2Q19, adjusted for IFRS 16), which should enable the company to undertake additional bolt-on and transformative transactions (based on our estimates, WSP still needs to acquire $450-million of revenue in 2020 to reach the lower end of its revenue target of $8–9-billion for 2021).”
Laval-based Bellus Health Inc. (BLU-T) was down 8.4 per cent after announcing before the bell the launch of a US$60 million public offering of its common shares and the filing of an application to list its common shares on the Nasdaq Global Market in the United States.
U.S. oil and gas producer Concho Resources Inc. (CXO-N) fell 5 per cent after it said on Tuesday it would sell its New Mexico assets for US$925-million to an affiliate of privately held Spur Energy Partners LLC, which is backed by global investment firm KKR.
Oil and gas companies have been looking to trim non-core assets and focus their spending on areas including Permian’s Delaware and Midland basins.
With files from Brenda Bouw, staff and wires