Camber Energy Inc (NYSEAMERICAN: CEI) is having an overwhelmingly strong start to the trading session this morning, and for good reason. The company announced that a strategic transaction has come to a close, wiping a large amount of debt off of the table. Of course, the news excited investors, sending the stock on a run for the top. Today, we’ll talk about:
- The transaction;
- what we’re seeing from CEI stock as a result; and
- what we’ll be watching for ahead.
CEI Flies On Closed Strategic Transaction
As mentioned above, Camber Energy is having a great start to the trading session today after announcing that a key transaction has closed. In a press release issued early this morning, the company said that a previously announced transaction with N&B Energy, under which the a substantial portion of assets are being dispositioned in exchange for N&B’s assumption of all of the senior debt held with IBC by CEI has closed. The transaction closed on September 26th.
The most important part of this transaction is the extinguishment of debt. Through the transaction, $36.9 million in debt is wiped off of the table, eliminating monthly debt service payments of $425,000. In a statement, Louis G. Schott, Interim CEO at CEI, had the following to offer:
This transaction is a major milestone for the Company. We have significantly improved the Company’s balance sheet and have taken major steps towards regaining compliance with the continued listing standards of the NYSE American. With this momentum, we believe the Company is in a position for growth through acquisition and development opportunities.
What We’re Seeing From The Stock
As investors, one of the first lessons that we learn is that the news moves the market. In the case of Camber Energy, the news proved to be overwhelmingly positive. After all, with no bank debt left to worry about, the company is turning a new leaf and will focus on growth of the remaining assets. So, it comes as no surprise 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 (9:58), CEI is trading at $0.44 per share after a gain of $0.06 per share or 15.76% 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 story surrounding the company’s future moves after the closure of this key strategic transaction. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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