I'm not really sure what to make of this - seems like it gives CHK a bit more flexibility, but at what cost? Seems akin to to putting your garage sale supplies on a credit card.
I believe it gives them the ability to pay off loans that had covenants. The older loans would have constrained their ability to sell some properties/interests in order to raise cash.
It's going to cost them though - 8.5 percent interest.
This is scary. CHK's market cap, after the 14% drop yesterday is now under $10B. And the artcile says they need to sell $14B worth of assets to keep going. I feel for the employees, who are watching their 401K's plummet. HK's employees (and stockholders) sure got a better deal, when Floyd was smart enought to sell out.
About a month ago, I heard one stock analyst say CHK's stock price could fall into the single digits. It's not that far from there now, and the trajectory sure looks downward. It's just one revelation after another. I'm staying tuned.....
it's like watching a soap opera. Every week brings a new problem for CHK. I hope their employees and families will be well.
Looks like the loan amount is being upped to $ 4 billion - chk is working pretty hard to to keep from selling at the absolute bottom.
Many folks are not so forgiving when it comes to the "I-was-only-following-orders-defense" of the CHK worker bees reaping cushy $ rewards off the backs of innocent/hard-working landowners (such as happened with numerous struggling farmers) who were repeatedly lied to and taken advantage of by the thieving unscrupulous CHK employees and their hired landmen/brokers.
Yes, now the darn plucked chickens are coming home to roost.
Maybe the lessons learned will stick for others who are possibly thinking of doing the same thing via such tactics by yet other crooked operators. Of course, Enron wasn't that long ago, and that lesson didn't stick for long, did it? When this scandal first broke, some on GHS even said that such an analogy to CHK wasn't appropriate.
I wonder if they still feel the same way now?
Me, I feel for those who were hurt and taken advantage by the CHK greed. I saw it and heard the weeping of goodhearted elderly folks being bamboozled by CHK's house of cards vis-a-vis those trying to cheat these naive innocents via rigged and worthless "free royalty" clauses along with the bullying peanut first-round offers and constant lies from the landmen working for CHK. I heard it with my own ears, being repeatedly lied to. (Hey, it doesn't take a gun to rob someone blind.)
So, I mean -- I don't feel for the thieving crooks. Let them "reap what they've sowed." I can only hope our American justice system steps up and locks up some of the white-collar crooks who joyously felt the need to work for such an unethical company.
CHK is obviously not interested in selling out the company to a buyer. If I were a stockholder, I'd want the company to sell out. These loans appear to be their way of trying to stay afloat in a very difficult environment. You might expect to see a slew of announcements about asset sales, but you don't. This could be because potential buyers are smelling blood and they don't want to overpay. So it might be a painful stalemate of CHK not selling at dirt-cheap prices, while taking on more and more debt to try to keep going. Ouch. Selling the whole company sounds like a good idea to me. XOM?? China? Where are you???
Henry, be very carful of what you wish for. I agree that CHK has not played fair with many landowners. I agree that a buyout would eliminate a big problem, but I hope that a reputable and America friendly company or country does the buying. If the oil and gas in America, plus jobs and money leave American soil then the damage would be much worse than what McClendon is doing. If McClendon has any heart, at all, he will not sell to just anybody, although he has done some of this already. Where are the American, Canadian and Australian companies? Henry, hope for a win-win.
If McClendon has any heart.........where do you think Mr. Cheney got his replacement heart from?
McClendon doesn't give a rat's #$& about USA when it comes to money in his pocket. He's just like 95% of the rest of us, the smell of money is intoxicating.
I'd like to see him in a Oklahoma wind storm, all goocheed eyed from looking for pennies on the sidewalk and a dollar comes blowing by.
I'm kinda rooting for a CHK bankrupcy myself.
That's cruel. Yes, you and I both really don't like CHK for any number of good reasons. But there are many decent people who work for them who are watching their 401K value drop daily. I'd be more than happy to see a big oil company buy them out, and then let the adults run the show.
So, Henry, are these "decent" people whom you're speaking of . . . "decent" enough to go share their concerns with the SEC and/or the Attorney General's and/or other law enforcement as to what they personally knew about the many CHK flimflams so as to help the poor landowners who were cheated document their cases?
I mean, are those the kind of "decent" people who you think need help with their "frothy winnings" from the CHK bubble?
Maybe an ex-Enron insider survivor will chirp up and explain the tragic circumstances that they personally experienced when those Houstonian thieves laughed and joked and made fun of the poor folks that they were pickin' the pockets of . . . all the way to the bank. Remember, those crooks were caught on tape, and there was no denying it. A fact.
So, I wonder if any "decent" CHK employees have such tapes and want to come clean?
Maybe some of 'em are reading this; and, y'know, maybe their conscience is beginning to nag 'em, and they might want to unburden themselves to the D.A.
Or just anonymously post here on GHS.
Many would love to read whatever any of 'em had to share.