Camber Energy Inc (NYSEAMERICAN: CEI) had a strong start in the pre-market this morning and continues to trade in the green. The gains come after the company announced that it signed a letter of intent surrounding a pipeline-related acquisition. Today, we’ll talk about:
- The letter of intent;
- what we’re seeing from CEI stock as a result; and
- what we’ll be watching for ahead.
CEI Announces Pipeline Acquisition
As mentioned above, Camber Energy is trading in the green in the market this morning after the company announced that it entered into a Letter of Intent surrounding a pipeline-related asset purchase. The news was released in the premarket this morning by way of press release.
In the announcement, the company said that it has executed the non-binding letter of intent in connection with its acquisition of a midstream pipeline integrity services, specialty construction and field services company. Should the transaction close, it will be paid for 100% in stock.
In the release, CEI said that the transaction is subject to customary closing conditions, negotiation of final transaction documents and transaction terms, as well as other conditions. The company plans on entering a definitive agreement on or before April 30, 2019.
In a statement, Louis G. Schott, Interim CEO at CEI, had the following to offer:
We are excited about the opportunity which this acquisition presents. If completed, this transaction will enable the Company to leverage its available cash reserves and build shareholder value through a change in business focus to pipeline service and construction. We believe there are opportunities to leverage growth opportunities in the markets the pending acquisition is targeting and that the segments it provides services to are less susceptible to sudden changes in pricing and demand which have impacted us in our operations in the market for oil and gas.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news leads to moves. In the case of Camber Energy, the news proved to be overwhelmingly positive.
After all, the potential acquisition of the pipeline asset could lead to a large increase of value for investors. So, it’s not surprising to see that excited investors are pushing the stock on a run for the top.
As is normally the case, our partners at Trade Ideas were the first to alert us to the gains. Currently (10:23), CEI is trading at $0.42 per share after a gain of $0.014 per share or 3.52% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on CEI. In particular, we’re interested in following the news surrounding this potential asset acquisition as it could greatly increase value for investors. Noentheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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