sculpin

Picking away at some energy names. Just like Seth.... 13F Insights: Seth Klarman Says Goodbye To Deep Value NOVEMBER 16, 2015 Seth Klarman's Baupost Group is trading in deep value stocks for flawed commodity ones, or so it would seem. Unless, of course, you're one of those that believes commodities can be considered deep value. In which case, you probably shouldn't be reading this to begin with. Now to the fun - Klarman added 47% to his Cheniere Energy (LNG) position, which is still the fund's largest holding - making up 18% of the portfolio. It kept the Viasat (VSAT) position steady - 2nd largest - and added Alcoa (AA) to the portfolio ti make it the 3rd largest holding. With that - Klarman's exposure to the materials industry goes from nil last quarter to 14%. And Energy stocks still make up 39% of his portfolio.

Marret final distribution from the Mobilicity position. Anyone buying around the $0.26 level are essentially getting a free ride on the $0.78/unit value still recorded for the Cline mining position. Marret High, Marret Multi-Strategy to pay distributions Marret High Yield Strategies Fund (C:MHY) Shares Issued 36,729,002 Last Close MHY.UN 10/28/2015 $0.265 Thursday October 29 2015 - News Release Also Marret Multi-Strategy Income Fund (C:MMF) News Release Mr. Barry Allan of Marret Asset Management reports MARRET ASSET MANAGEMENT ANNOUNCES DISTRIBUTION FOR MARRET HIGH YIELD STRATEGIES FUND AND MARRET MULTI-STRATEGY INCOME FUND Marret High Yield Strategies Fund and Marret Multi-Strategy Income Fund will pay distributions to unitholders of record on Nov. 9, 2015, with a payment date on Nov. 13, 2015. Marret High Yield Strategies Fund will pay a distribution of $0.2559 per unit and Marret Multi-Strategy Income Fund (TSX: MMF.UN), will pay a distribution of $0.1624 per unit to Class A unitholders.The distributions represent further proceeds received by the funds from certain bonds issued by Data & Audio-Visual Enterprises Wireless Inc., which operates as Mobilicity, pursuant to the sale of Mobilicity to Rogers Communications. The distributions represent the net proceeds received by the funds and will be the final distributions of the Mobilicity proceeds. They are being made in accordance with the ongoing termination of the funds.In accordance with the applicable rules of the Toronto Stock Exchange ("TSX"), the "due bill" trading procedures of the TSX will apply to the distributions. The units of the funds will trade on a "due bill" basis from two trading days prior to the Distribution Record Date (i.e., November 5, 2015) to the Payment Date, inclusively (the "due bill period"). Any trades that are executed on the TSX during the due bill period will be identified to ensure purchasers of the funds' units receive the entitlement to the respective distribution.The units will commence trading on an ex-dividend basis on November 16, 2015, as of which date purchases of units will no longer have an attaching entitlement to the distribution. The due bill redemption date will be November 18, 2015.

Just spent 3 days in Alberta. Layoffs accelerating, ramifications of the NDP ascension to power are beginning to hit home and all think it will be lower for longer. Reminds me of the below Don Coxe quote..... “The most exciting returns are to be had from an asset class where those who know it best, love it least, because they have been hurt the most.” - Don Coxe

$130 Brent Oil by 2017 http://www.bloomberg.com/news/videos/2015-10-22/why-crude-oil-prices-may-hit-130-a-barrel-in-2017

Curious, any specific names you find compelling? TIA! Here you are... Another Way To Play Dundee Corp. http://canadianvalueinvesting.com/?p=133 And Transalta... Another I like - TA.PR.J - Take a look. 10% yield until reset in Sep 2019. Marginable. TA has its flaws but I don't think the Prefs will be worthless. http://canadianvalueinvesting.com/?p=130 Couple of recent pref videos... http://tdwealthmedia.com/videos/investment-opportunity-cdn-pref-shares-worth-a-second-look/ Wed, Oct 7, 2015 - 10:50 AM The TSX preferred share index is down more than 20% in the past year as is the Horizon Active Preferred Shares ETF (HPR). What's wrong? And does this weakness (and almost 5% yield) provide an opportunity? We'll find out. http://www.bnn.ca/Video/player.aspx?vid=722047 A buyout of Transalta would most likely result in the preferreds being bought out at par ($25) or being the responsibility of a financially stronger entity which would see them rerate higher as well.... The Globe and Mail reports in its Thursday edition that unnamed sources say TransAlta ($6.79) has held talks with more than one potential suitor in the past several months. A Bloomberg dispatch to The Globe reports that sources say TransAlta was near a sale last week before that deal fell through. TransAlta had a market capitalization of about $1.8-billion as of Tuesday's close, after the stock plunged 44 per cent since the end of April amid price-fixing charges, rising carbon costs and lower power prices in Alberta, and as it struggles with $4.2-billion of debt. National Bank analyst Patrick Kenny says, "Fundamentals have changed here in Alberta and that creates an opportunity for a buyer who might take a more constructive view." Private-equity investors could be drawn to TransAlta's high cash flow, relative to its beaten down share price, says Mr. Kenny. TransAlta's free cash flow yield is now about 20 per cent, he says. Last month, TransAlta reached a tentative deal to pay $56-million in fines to settle market-manipulation charges, after Alberta regulators said the company engaged in "anti-competitive conduct" by shutting plants in 2010 and 2011 during periods of high demand.

Patience. Fundamentals will win out with supply dropping and demand continuing to rise. From Core Labs today followed by Nawar's comments below.... Global demand for hydrocarbon-based energy continues to improve, while worldwide crude oil supply has peaked and fallen in the second half of 2015 and will continue to do so for the remainder of the year. U.S. production continues to fall from its peak in April 2015 and the Company now believes production could fall by over 700,000 barrels of oil per day ("bopd") from that peak by year-end 2015. Internationally, second half 2015 crude oil production is also likely to decline. Core is increasing its estimate of the net worldwide annual crude-oil production decline curve rate to 3.1% from 2.5%. The further decline by 60 basis points is due to sharper decline curve rates for tight oil reservoirs and the significant decline in maintenance capital expenditures for the existing crude-oil production base. At current North American activity levels, Core predicts 2016 crude-oil production to be lower year-over-year; perhaps falling over 900,000 bopd in 2016. If Core numbers are accurate the shortfall in terms of global supplies in 2016 will be substantially larger then what I am expecting, for the US I am expecting a 600K decline in 2016, however CLR is pointing to 900K decline. If prices do rebound in 2H-2016 we may end up with a decline that is closer to my number. Most importantly, I find their 60 basis points increase in the net decline rate to 3.1% (this is after infill drilling) extremely important. At 3.1% net decline (or managed decline) from existing fields in addition to 1.3m expected growth in demand translate into 4.3m barrels of new production the needs to come from new projects, this compares to 3.7m using their previous 2.5% net decline rate. Such subtile yet crucial data point is completely ignored by the media. While traders are fretting about a handful of million barrels in the EIA weekly oil storage report, CLR just removed 219m barrels from 2016 supplies due to accelerating decline rate (something that I have touched upon before on BRY) Regards, Nawar

Yes there is potential for bankruptcy but with a very well funded PE firm like Clairvest determined to make this Company work, these bonds should not be trading at the price they currently are. The military training business is stable cash flow generator. The businesses that are a drag on the profitability will either be fixed or their assets sold to reduce the overall debt burden of Discovery Air. I believe the risk reward tradeoff on the debentures is attractive at these levels.

30 June 2018 - little under 3 yrs to maturity Discovery Air DA.DB.A 8.38% 30-Jun-18 34.40 4.34 60.51% 626.70% 19.72 5.07 DA.A 0.24 Good Canadian exchange traded debenture listing site... http://www.financialpost.com/markets/data/bonds-debentures.html

Sold it all on announcement of the deal > $2.15. Put more into next spec multibagger - a debenture trading at $34 on the TSX. Discovery Air (DA.DB.A) 8.375% debentures - 60% yield to maturity backed by Clairvest who have been buying the equity over the last 6 months. Selling off non core assets that contribute little to cash flow and reinvesting in the high margin military air training business. CLAIRVEST GROUP INC. ENTERS INTO AGREEMENTS TO ACQUIRE SHARES OF DISCOVERY AIR INC. Clairvest Group Inc. has entered into agreements to acquire 4,249,457 common shares of Discovery Air Inc., representing approximately 5.2 per cent of Discovery's current issued and outstanding common shares, at a price of 30 cents per share. DISCOVERY AIR ANNOUNCES COMPLETION OF RIGHTS OFFERING Discovery Air Inc. has completed its rights offering, which was first announced on Jan. 19, 2015. A total of 50 million Class A common voting shares and no Class B common variable voting shares were issued at a price of 22 cents per common share, for aggregate gross proceeds of $11-million. In aggregate, 46,267,443 Class A shares were issued to certain funds and co-investors of Clairvest Group Inc., for gross proceeds of $10,178,837.

Curious, any specific names you find compelling? TIA! Here you are... Another Way To Play Dundee Corp. http://canadianvalueinvesting.com/?p=133 And Transalta... Another I like - TA.PR.J - Take a look. 10% yield until reset in Sep 2019. Marginable. TA has its flaws but I don't think the Prefs will be worthless. http://canadianvalueinvesting.com/?p=130 Couple of recent pref videos... http://tdwealthmedia.com/videos/investment-opportunity-cdn-pref-shares-worth-a-second-look/ Wed, Oct 7, 2015 - 10:50 AM The TSX preferred share index is down more than 20% in the past year as is the Horizon Active Preferred Shares ETF (HPR). What's wrong? And does this weakness (and almost 5% yield) provide an opportunity? We'll find out. http://www.bnn.ca/Video/player.aspx?vid=722047

Libya & Brazil & Chinese demand oh my With thanks to members of the IV BRY board....http://www.investorvillage.com/smbd.asp?mb=4288&mn=203901&pt=msg&mid=15360575 U.S. oil output on brink of "dramatic" decline, executives say Oct 6 2015, 15:28 ET | By: Carl Surran, SA News Editor Oil industry execs speaking at the Oil and Money conference in London warn of a "dramatic" decline in U.S. production that could pave the way for a future spike in prices if fuel demand increases. Libya's oil output down to 300,000 bpd Oct 5 (Reuters) - Libya's oil production has dropped to 300,000 barrels per day, less than a quarter of what it produced before the 2011 fall of Muammar Gaddafi, mostly because of insecurity and closed pipelines, a top official said. http://www.reuters.com/article/2015/10/05/libya-energy-idUSL8N12536220151005 Oct 5 (Reuters) - State-controlled Petróleo Brasileiro SA , struggling with the biggest debt load among global oil firms, on Monday cut capital spending plans for this year and next by $11 billion in the wake of a slump in Brazil's currency and in oil prices. In a securities filing, the company, commonly known as Petrobras, said planned investments will be cut to $25 billion and $19 billion for 2015 and 2016, respectively, from $28 billion and $27 billion previously. Budgeted costs plus operating expenses excluding purchases of raw materials were trimmed for this year and next as well, the filing said. WoodMac also had a blog entry this morning about why Chinese oil demand is holding: Analysing each oil product and exploring the drivers for each product, we find that gasoline, aviation fuel, and chemical feedstock related products such as LPG and naphtha are expected to grow robustly due to China's growing need for consumption-oriented products. Specifically, we estimate that around 90% of oil demand growth will stem from consumer-related oil products this year, underpinned by rising household income and urbanisation. China's growing middle class will drive the demand for consumer related oil products – of that there is no doubt. Notably, we have seen growth in air passenger traffic expand at a pace of almost 15% in the first seven months of this year compared to the same period in 2014. As such, our view of jet fuel remains optimistic and demand is expected to expand just over 13% through the rest of 2015. http://www.woodmac.com/analysis/oil-demand-China I am not sure when we gonna finish with the media message that Chinese oil demand is slowing, if anything Chinese oil demand is accelerating compared to last year (unlike other commodities):

Are we heading towards a huge miss in forecasts (Goldman especially) and a historic collapse of production in NA? Yes and also a drop in world wide supply as well at the same time demand is ratcheting up throughout the world due to lower prices. Rigs will not be able to come back quickly after the personnel and equipment attrition in the service sector that has taken place in the last 12 months.

Canadian Rate Reset Preferreds. http://www.theglobeandmail.com/globe-investor/investment-ideas/interest-rates-provide-answers-about-plunging-preferred-shares/article24013205/ Gotten worse in September... Preferred shares suffered their third consecutive month of significant price declines, returning -3.82% in August. The market action last month strongly resembled that of the summer of 2013, when the Taper Tantrum caused preferred shares to selloff and then recover sharply in the autumn of that year. With price declines occurring on low volumes and selling indiscriminately spreading from low reset spread issues to all types of preferred shares, the decline of the market during August appeared to be capitulation by some retail investors giving up on the asset class.

Actually CCZ is followed (not very well since Steve Li left) by Industrial Alliance Securities.... Critical Control Energy Services (CCZ-T, $0.35, Speculative Buy, Target $0.55) CCZ Transforms into a Pure Play Energy Services Company. Speculative Buy Rating Established with a $0.55 Target Price Click here for summary Click here for full report SUMMARY Critical Control Energy Services (CCZ-T, $0.35, Speculative Buy, Target $0.55) Analyst: Elias Foscolos [email protected] 403-705-4980 CCZ Transforms into a Pure Play Energy Services Company. Speculative Buy Rating Established with a $0.55 Target Price · Critical Control has completed a transformative four months in which the Company has divested its non-energy services business and closed a US acquisition, positioning itself for focused growth. · On Tuesday, shareholders approved a name change to Critical Control Energy Services Corp. from CriticalControl Solutions Corp. symbolizing the Company’s new energy services focus. · Financial highlights from Q1/15 include the fact that revenue grew to $9.5M, which was a YoY increase of 27%. Adjusted EBITDA, on the other hand, remained flat during the same time period. · Through a series of three transactions, the Company divested its non-energy services businesses for total consideration of $4M. In addition, CCZ closed the acquisition of assets from Dallas based Legacy Measurement. The Legacy acquisition should contribute $7M in annualized revenue and positively contribute to EBITDA. · We have made numerous modelling adjustments reflecting the fact that CCZ is now a pure-play energy services software focused company. Based on our valuation methodology, we established a target EBITDA multiple of 8x based on CCZ’s historical trading band. · Following the transfer of coverage on May 7, we are establishing a rating of Speculative Buy and Target Price of $0.55. · Our financial forecasts and target EBITDA multiple simultaneously contribute to our target price of $0.55. This correlates to a 57% potential one-year return supporting our Speculative Buy rating. · To see our full Research Update (June 26), please click here.

Legumex Walker says shareholders to get $2.50 to $2.75 in liquidation.... LEGUMEX WALKER ANNOUNCES SALE OF SPECIAL CROPS DIVISION TO THE SCOULAR COMPANY Legumex Walker Inc. has entered into a definitive agreement with the Scoular Company pursuant to which Scoular has agreed to acquire substantially all of the assets of LWI's special crops division for $94-million plus the amount of net working capital at closing, on a cash-free debt-free basis, paid in cash. The sale represents a CAD$174.6 million transaction value for LWI, based on LWI's working capital as at June 30, 2015. The actual purchase price and transaction value are subject to working capital and other adjustments in accordance with the Agreement (all figures are in Canadian dollars). Scoular is a leading U.S.-based agricultural marketing company that manages supply chain risk for global suppliers and end-users of grains, oilseeds, and other feed and food ingredients. As announced previously, the Special Committee of the Board of LWI (the "Special Committee") oversaw an extensive process starting in March 2015 (the "Strategic Review") and considered a number of alternatives to maximize shareholder value. As a result of the Strategic Review, and in light of the challenges facing the Company, the Special Committee unanimously determined that a sale of the Special Crops Division was most likely to maximize shareholder value. "Following careful review of the transaction by the Special Committee in consultation with our external financial and legal advisors, we believe this transaction represents excellent value and is in the best interests of LWI shareholders," said Bruce Scherr, Chairman of the Board of Directors of Legumex Walker Inc. "This is a highly strategic addition to our existing global feed and food ingredient merchandising business and U.S.-based grain-handling network," said Bob Ludington, Scoular's Chief Operating Officer. "The transaction will significantly increase our product and geographic footprint, which in turn will increase our ability to serve new and existing customers worldwide. We expect to operate Scoular Special Crops much like LWI operates the business today, but with the financial capacity to expand operations, product lines, and distribution channels. As a result, we will be able to provide additional value to Canadian producers and pursue opportunities to serve a global customer base seeking specialty products associated with healthy food trends." "The goal for our Special Crops Division was to bring together several exceptional businesses in our industry, diversify across our product offerings, growing regions and customers, and create an exceptional platform that would thrive as it grew," said Joel Horn, President and Chief Executive Officer, Legumex Walker Inc. "Coming off a record year for Special Crops, we are proud that an organization of the caliber of Scoular recognizes the value that we have created." Unanimous Approval of the Board The transaction has been approved unanimously by LWI's Board of Directors, which has determined that the transaction is in the best interests of the Company and its shareholders and recommends that shareholders vote in favour of the transaction at a Special Meeting of Shareholders, which will be scheduled for November 9, 2015 (the "Meeting"). Altacorp Capital Inc. ("Altacorp"), financial advisor to LWI's Board of Directors, has provided an opinion to the Board of Directors that, subject to the assumptions and limitations upon which the opinion is based, the consideration to be received by the Company in the transaction is fair from a financial point of view. Shareholder Approval and Other Conditions The implementation of the transaction will be subject to shareholder approval at the Meeting. The transaction must be approved by 66?% of shares voted at the Meeting and by majority of the shares voted at the Meeting, excluding votes attached to any shares owned or controlled by Scoular. At the date of this release, Scoular owns a $16.5 million convertible debenture of the Company, but does not own any shares of the Company. Each of LWI's directors and senior officers that hold common shares in the Company and the Company's largest shareholder group, Mr. Ivan Sabourin, the Ivan Sabourin Family Trust and the Richard and Elaine Sabourin Trust, which collectively hold approximately 15.5% of the outstanding common shares of LWI, have entered into voting support agreements with Scoular and have agreed to vote their common shares in favour of the transaction. Because Scoular holds a $16.5 million principal amount convertible debenture (which will be repaid out of the proceeds received at closing), it constitutes a related party of LWI for purposes of the Agreement under applicable securities law. Accordingly, the Special Committee retained Deloittes LLP to prepare a formal valuation, a summary or copy of which will be included in a Management Information Circular to be provided to shareholders of LWI in connection with the Meeting. The completion of the transaction is subject to regulatory approval, including approvals required under the Competition Act (Canada), Farm Lands Ownership Act (Manitoba) and The Saskatchewan Farm Security Act and certain other third party consents required for the assignment and transfer of assets and contracts. The Agreement includes customary non-solicitation, right to match and termination provisions, including termination in the event of a "Superior Proposal" (defined to include, among other events, an unsolicited offer for the purchase of not less than 50% of the shares of the Company which satisfies the requirements set out in the Agreement). The termination of the Agreement in the event of a Superior Proposal or a failure of shareholders to approve the transaction in the event of a Superior Proposal will trigger the payment by the Company of a $6 million termination fee to Scoular. In addition, the failure of shareholders to approve the transaction in the absence of a Superior Proposal will result in an obligation of the Company to reimburse Scoular for transaction related expenses, subject to a maximum of $950,000. The terms and conditions of the transaction will be disclosed in more detail in a Management Information Circular that will be mailed to shareholders as of the record date to be established. It is anticipated that the transaction, if shareholders approve and regulatory and other approvals are obtained, will be completed in the fourth quarter of 2015. Copies of the Agreement and of the Management Information Circular for the Meeting will be filed with Canadian securities regulators and will be available on the SEDAR profile of the Company at www.sedar.com. In addition, investors and shareholders may obtain free copies of the documents the Company files with Canadian securities regulators by directing a written request to LWI, 1345 Kenaston Boulevard, Winnipeg, MB R3P 2P2 Attention: Corporate Secretary. Investors and shareholders of the Company are urged to read the Management Information Circular and the other relevant materials when they become available because such materials will contain important information about the transaction. Update on Pacific Coast Canola LLC (PCC) The Special Committee of the Board has entered into a non-binding term sheet on an exclusive basis with respect to a possible transaction for the Company's ownership interest in PCC (the "PCC Transaction"). There is also a forbearance agreement in place with AgCountry Farm Credit Services to allow all parties time to finalize the PCC Transaction. Although the outcome of any such transaction is uncertain, the Company currently believes it will complete the PCC Transaction prior to the Meeting but does not expect to receive any value from the sale of its 84% interest in PCC. Plan of Liquidation The sale of the Special Crops Division and the PCC Transaction will allow the Company to wind up its operations and return to its shareholders the net proceeds of the sale of the Special Crops Division, after repayment of all bank debt and other liabilities, taxes and transaction related other expenses (in total the "Obligations") as part of a Court approved liquidation process. Accordingly, at the Meeting shareholders will also be asked to approve a plan of liquidation for the Company. While there is no guarantee as to the net amount of distributions to shareholders following the sale of the Special Crops Division, the Company currently expects, after repayment of all Obligations, to distribute a per share amount in the range of $2.50 to $2.75. A decision in respect of the timing and the amount of distribution will be made by the liquidator to be appointed following completion of the sale of the Special Crops Division and completion of the PCC Transaction. An initial distribution is expected in the first or second quarter of 2016, with a possible final distribution following liquidation. The amount and timing of any distribution will only be determined during the liquidation process by the liquidator under supervision of the court. The common shares of the Company are expected to cease trading and be delisted from the Toronto Stock Exchange within a month following court approval of the plan of liquidation. AltaCorp Capital Inc. has acted as financial advisor to the Company's Special Committee. Origin Merchant Partners has acted as financial advisor to Scoular.

Finally! Some cash coming back to the Marret holders... Marret High to pay 44.61-cent distribution Sept. 25 2015-09-11 17:19 ET - News Release An anonymous director reports MARRET ASSET MANAGEMENT ANNOUNCES DISTRIBUTION FOR MARRET HIGH YIELD STRATEGIES FUND Marret High Yield Strategies Fund will pay a distribution of 44.61 cents per unit to unitholders of record on Sept. 22, 2015, with a payment date on Sept. 25, 2015. Pursuant to the sale of Mobilicity to Rogers Communications, the fund received cash payment for certain bonds issued by Data & Audio-Visual Enterprises Wireless Inc., operating as Mobilicity. The distribution represents the net proceeds received by the fund and is being made in accordance with the ongoing termination of the fund. In accordance with the applicable rules of the Toronto Stock Exchange ("TSX") the "due bill" trading procedures of the TSX will apply to the distribution. The units of the fund will trade on a "due bill" basis from two trading days prior to the Distribution Record Date (i.e., September 18, 2015) to the Payment Date, inclusively (the "due bill period"). Any trades that are executed on the TSX during the due bill period will be identified to ensure purchasers of the fund's units receive the entitlement to the distribution. The units will commence trading on an ex-dividend basis on September 28, 2015, as of which date purchases of units will no longer have an attaching entitlement to the distribution. The due bill redemption date will be September 30, 2015. Marret expects to receive additional proceeds for certain other Mobilicity bonds held by the fund; however, the final determination on payment has not yet been made. Marret Multi-Strategy to pay 40.71-cent distribution 2015-09-11 17:18 ET - News Release Mr. Barry Allan of Marret Asset Management reports MARRET ASSET MANAGEMENT ANNOUNCES DISTRIBUTION FOR MARRET MULTI-STRATEGY INCOME FUND Marret Multi-Strategy Income Fund will pay a distribution of 40.71 cents per unit to Class A unitholders of record on Sept. 22, 2015, with a payment date of Sept. 25, 2015. Pursuant to the sale of Mobilicity to Rogers Communications, the fund received cash payment for certain bonds issued by Data & Audio-Visual Enterprises Wireless Inc., operating as Mobilicity. The distribution represents the net proceeds received by the fund and is being made in accordance with the ongoing termination of the fund. In accordance with the applicable rules of the Toronto Stock Exchange ("TSX") the "due bill" trading procedures of the TSX will apply to the distribution. The units of the fund will trade on a "due bill" basis from two trading days prior to the Distribution Record Date (i.e., September 18, 2015) to the Payment Date, inclusively (the "due bill period"). Any trades that are executed on the TSX during the due bill period will be identified to ensure purchasers of the fund's units receive the entitlement to the distribution. The units will commence trading on an ex-dividend basis on September 28, 2015, as of which date purchases of units will no longer have an attaching entitlement to the distribution. The due bill redemption date will be September 30, 2015. Marret expects to receive additional proceeds for certain other Mobilicity bonds held by the fund; however, the final determination on payment has not yet been made. There is no guarantee the Toronto Stock Exchange will permit the fund to maintain its listing. Please consult with your tax advisor on the possible consequences if the fund is delisted.

Acquirers use Ebitda multiple on acquisition. Corporate costs will be eliminated in the purchase by a strategic competitor. PCC will be divested to the primary lender.

So what are the numbers on this? Cash flow, mkt cap, debt level etc. Valuation? Replacement cost? Any hidden assets?

The plunge after the PCC loan call was mostly optics I think along with the potential that they would not get relief on cross default triggers - they did. Many of the analysts assumed very little equity value for PCC to LWP prior to the default anyway. Perhaps the fact that LWP was trading as high as the $4's was the market was too optimistic about the valuation that LWP could get for both PCC and Specialty Crops - with the shares now around the $1 level perhaps the market has swung to far to the negative?

Potential Multibagger dependent on Near Term M&A Process Legumex Walker - (TSX - LWP) currently trading at $1.00 Cdn has been in a strategic review process for about 5 months. They have 2 divisions PCC Canola - this is a specialty canola crusher located in Washington State which has been an albatross around the Company's neck. It has defaulted on its loans and will result in $0 return to the parent Company. However its large debt does not have any claim to Legumex. Specialty Crops - this is where the core value lies in LWP and which Raymond James (note below) and Cormark Securities (also below) estimate value return from $1.25 to $3 per share if the strategic sales process finds a willing buyer. This is very speculative due to LWP's debt and dependence on the outcome of the strategic review. However, from the $1 level, speculators could realize multi bagger potential based on the quality of LWP's attractive Specialty Crops business. Raymond James.... (pdf attached) Steve Hansen CMA, CFA | 604.659.8208 | [email protected] Daniel Chew CA (Associate) | 604.659.8238 | [email protected] Agribusiness Weak 2Q15 Results (but Irrelevant); Company Still for Sale, Expect Update Soon Recommendation Legumex Walker’s tumultuous history as a public company is nearing an end, with a strategic sale increasingly likely in the coming weeks, in our view. Our fundamental assessment of the company’s Specialty Crops division—where all of the residual equity value lies—suggests a potential exit well above LWP’s current trading value. However, given the acute uncertainty surrounding recent events, and the potential for the sale transaction(s) to fall through, we rate the story Market Perform (vs. Under Review prior). Analysis  Company Still for Sale; Update Expected in the Coming Weeks—The most salient takeaway from LWP’s 2Q15 results, in our view, was the clear message that: 1) the company is still for sale; and 2) that the process is likely to conclude in the coming weeks. Underscoring this message, we highlight that both the Special Crops and Oilseed Processing (PCC) segments have been reclassified as ‘discontinued operations’, with supporting disclosure that the assigned Special Committee ‘expects to provide an update in the coming weeks as the process nears completion’. With little equity value currently ascribed to PCC, we believe that the sale of Specialty Crops will be the key to unlocking value for LWP shareholders.  Forbearance Received on AgCountry PCC Loan—In an odd twist, AgCountry has now provided forbearance on PCC’s senior credit facility, which is expected to allow the strategic sales process to continue. Unknown at this juncture, however, is what kind of damage was done to the sales process subsequent to AgCountry issuing a notice of demand on PCC’s senior credit facility on July 31, a move that sent LWP shares spiraling lower.  Wide Range of Outcomes—As illustrated in the accompanying exhibit, we foresee a wide range of potential outcomes for LWP shareholders, with a potential sale of the company expected to generate somewhere between $1.25 and $3.00 per share. Valuation Our $2.00 target price is based on an 8.6x multiple applied to our 2015E Specialty Crops EBITDA estimate, a multiple that resides at the low end of LWP’s historical trading range (6.0x-15.0x), reflective of the company’s recent financial challenges and ongoing extended strategic review process. Cormark.... Investment Thesis: Legumex Walker consists of two ag-processing businesses. The special crops processing business is among the most diversified players in Canada. The canola crushing operation has significant logistical advantages, strong partnerships, and substantial barriers to entry. Highlights: • Q2/15 Results; Strategic Review Ongoing Q2/15 results were soft but not all that relevant given the ongoing strategic review process, which is now heading into its fifth month. As a result of the intention to sell both PCC and Special Crops, both segments have been presented as discontinued operations, resulting in very messy disclosure. With the quarter, the company announced that AgCountry has granted forbearance on the PCC loan breach and that all other creditors have issued a similar forbearance under cross default provisions. Despite these tensions abating, as a result of the very challenging crushing environment expected to persist into the foreseeable future, it is unlikely the company will recapture any equity value from PCC, regardless of whether it defaults or is sold. The company once again articulated a view that the PCC debt is non-recourse to Special Crops, allowing the segment to be sold on an unencumbered basis. We continue to believe that this asset has equity value, and notwithstanding a stock price and financial position that renders the company with very little negotiating leverage, believe this asset will be sold, likely shortly. We reiterate a $2.50 target, based on now just Special Crops, and a Buy (S) recommendation. LWP_RJ.pdf

Missing barrels redux? If the IEA’s current picture of the degree of oversupply is badly flawed, it wouldn’t be the first time this has happened. During the 1998/1999 oil price collapse, the IEA also had a similar call on the oil market, noting a large imbalance in supply and demand that was completely out of proportion to the growth in OECD stocks that occurred. This difference was coined “missing barrels”, as presumably this oil was being stored in the developing world and outside the observation of statistical reporting agencies. At its worst, the IEA’s oversupply picture ballooned to 647 million barrels, which was an order of magnitude greater than the 120 mmbbls of storage that was commonly believed to have existed within the developing world at that time. It is still a matter of debate as to whether these barrels ever existed. Those around in 1998/1999 will recall that the IEA’s view of oversupply added topspin to the oil price correction and prolonged the duration. Today’s oil market appears eerily similar to the oil market of 1998/1999 to us. The $42/bbl oil price (WTI) we are currently staring at is due in large measure to the IEA’s assertion that the oil market is 3 mmbbl/d oversupplied, when credibly only 1.1 mmbbl/d of that increase can be objectively verified. The current opportunity is that market participants appear to have bitten hook, line and sinker on the IEA’s notion that the globe is awash in oil and is currently reflected in equity values. What if the IEA is wrong and the world is only modestly oversupplied as the OECD build suggests? If that is the case, this market should come into balance far quicker than is being discounted. From GMP Equity Research MQL__Oil.pdf

Could be some incredible bargains (in both E&P's and service companies) out there over the next 4 months especially as the tax loss selling season hits. Aveda pulled off an outstanding deal here but the underlying business is so weak and they do have a fairly substantial amount of debt. Aveda Transportation & Energy Services Inc. (AVE-V) Q2 Shows Depth of Challenge Facing a Newly Enlarged AVE 12 Month Target: $3.00 (was $6.00) Rating: BUY (unch) Q2 results were, not surprisingly, much weaker than one year ago. What was surprising was negative gross margin (-11%). This speaks to the brutal competitive market facing rig movers. Sales were down 28% to $23.0 million, slightly ahead of our forecast. But EBITDA came in at -$2.2 million, well below our $1.4 million forecast. US sales were down 19% y/y while Canadian sales were down 70% as rig counts hit new multi-year lows. US sales comprised 92% of total sales. Aveda closed the Hodges acquisition on June 15th for US$42 million. It has since disposed of 350 pieces for US$22 million and restructured operations. We believe that ultimately this will prove to be a great deal that has removed a significant competitor. Near-term results from the acquired business will be unimpressive, with monthly run-rate data well below expectations. With rig activity dropping by 50%+ y/y, the impact on pricing has been severe. We expect margins will remain challenged for several quarters, with management guiding Q3 to be EBITDA negative. We are significantly lowering expectations. With the proceeds from the asset sale, the balance sheet sees net debt of roughly $70 million (including note issued on Hodges deal). Given current borrowing availability at twice the $25 million minimum threshold, there are no financial covenants to be met. While there remains flexibility and we expect working capital to generate cash in Q3, debt repayment is a priority. With dramatically lower EBITDA estimates, our 12-month target moves to $3.00 (from $6.00). Current TBV of $3.41 backstops our valuation during this trough EBITDA period. We maintain a BUY rating, but believe investors should be patient in picking their entry point. Analyst: Michael Mills, MBA, CFA 902.425.8897

17TH Report Of The Monitor is out. Good news - they seem to have settled issues with all known claimants. First Lien notes will get $163.9 mm. Second Lien notes will get $67.7 mm. Payments will go out by the end of this month. That leaves roughly $111 mm for the Unsecureds. They will settle 2 other unsecured claims for $2.45 mm. No payment on the Quadrangle Subordinate Unsecured Note. Great news on MHY/MMF. Will spend weekend going over this Monitor Report. If you want to start another topic on MHY in the Investments section of CofB&H that would be fine with me.

---Critical thinking?? --- Please provide a detailed cash flow valuation for your suggestion that the US $ is a good buy? https://en.wikipedia.org/wiki/Schadenfreude --- Self explanatory In summary --- http://www.urbandictionary.com/define.php?term=douche

I believe that I saw that there is no additional interest accruing on any debt beyond the transaction date. As far as the CRO, he says... Aziz says “it is unlikely any material unknown claims exist” against Holdings. I would love to receive the secured payment ($0.65/unit?) from MHY in the next few months.