(Idea) Our Thoughts On Greenfire Resources Vs Waterous Fund

By: Jon Costello

Greenfire Resources (GFR) is an oil sands-focused E&P that produced 19,100 bbl/d in the third quarter. As of mid-November, the reported it was producing approximately 21,500 bbl/d.

GFR’s stock can be described as a “broken SPAC.” Its U.S.-listed shares began trading on the NYSE at $10.10 on September 20, 2023. Today, at around $7.00, they trade at a 31% discount from their de-SPAC price.

GFR is embroiled in a unique situation in which a large oil sands consolidator is seeking to gain control of the company. The ultimate price to be paid for the outstanding shares is unknown, but since the company has been put “in play,” its shares may entice some investors as a special situation.

I became a shareholder of GFR in March of this year when I began acquiring shares for myself and clients in the mid-$5.00 range. I sold out over the past few weeks, first, to lock in a decent return and second, because I lack firm conviction with regard to how the company’s future will play out.

As a shareholder, I followed GFR closely. I believe a takeout offer is highly probable. This article provides background aimed at helping subscribers render their own verdict about the company’s potential as a takeover play.