Escalera Resources Co. (fka ESCRQ)

[CalderQuacks]

IMO I think there is a merger/acquisition talk going on right now between $WRES and $ESCR that could be announced Pre-Market Monday.

These are all my opinions based on the facts I was able to put together and can be seen as assumptions, so please do not take this as advice on whether to buy or sell a certain security. Please trade at your own risk.

Here is a timeline of events which will be followed by my opinion on what could possibly be happening:

5/6/2015
“$ESCR receives delisting notification from NASDAQ and has until 8/27/2015 to regain compliance”
http://biz.yahoo.com/e/150506/escr8-k.html

6/16/2015
“Escalera Resources Announces $47 Million Purchase Agreement to Expand Atlantic Rim Holdings”
http://finance.yahoo.com/news/escalera-resources-announces-47-million-130000800.html
$ESCR announces it plans on acquiring $47MM worth of assets from $WRES by 9/1/2015

6/26/2015
“$WRES receives delisting notification from NASDAQ and has until 12/21/2015 to regain compliance”
http://biz.yahoo.com/e/150626/wres8-k.html

8/6/2015
“$ESCR enters into a Forbearance Agreement amendment with its credit facility”
http://biz.yahoo.com/e/150806/escr8-k.html
$ESCR is hurting for money

9/1/2015
“Companies extend deadline for purchase and sale agreement to 9/17/2015”
http://biz.yahoo.com/e/150901/wres8-k.html
The companies announced they are still in talks and need an extension to finalize the deal.

9/17/2015
Nothing is announced on whether the agreement went through or not by either company

9/30/2015
“$WRES announces relocation of corporate headquarters to Denver, Colorado”
http://finance.yahoo.com/news/warren-resources-announces-relocation-corporate-211500370.html
This is interesting because $WRES decided to move their corporate offices to their existing regional office which is roughly 1 mile from $ESCR’s corporate offices
https://www.google.com/maps/dir/Escalera+Resources+Co,+1675+Broadway+Street+Suite+2200,+Denver,+CO+80202/1331+17th+St+%23720,+Denver,+CO+80202/@39.7462692,-104.998424,16z/data=!3m1!4b1!4m13!4m12!1m5!1m1!1s0x876c78d5d1f6697f:0xad0212c6b10010cf!2m2!1d-104.9877239!2d39.7427536!1m5!1m1!1s0x876c78db46b7838f:0x3862df8a783d7474!2m2!1d-104.9966174!2d39.7509221

10/6/2015
“$WRES presents at the IPAA OGIS San Francisco Conference”
http://finance.yahoo.com/news/warren-resources-present-ipaa-ogis-110000388.html
In the presentation deck on page 5, it indicates there still is potential for the sale. Whether it is with ESCR or not is not indicated
Deck is under “IPAA OGIS Presentation” http://phx.corporate-ir.net/phoenix.zhtml?c=182913&p=irol-IRHome

10/7/2015
“$ESCR voluntarily delists from the NSDQ and moves to the OTC”
http://finance.yahoo.com/news/escalera-resources-announces-voluntary-delisting-210000020.html

10/28/2015
“$WRES announces it will release Q3 earnings and a conference call Pre-Market on Monday 11/9/2015”
http://finance.yahoo.com/news/warren-resources-schedules-third-quarter-141500774.html


Summary:

$ESCR shareholders haven’t heard anything from their team yet and the PPS has taken a BIG plummet down to under $.05/share currently.

As of 6/30/2015 $ESCR had $97.7MM Total Assets versus $67.7MM Total Liabilities and 14,307,414 shares outstanding as of 7/31/15.
http://www.sec.gov/Archives/edgar/data/29834/000155837015001654/escr-20150630x10q.htm

This would imply a ~$2.10/share Book Value for the company and a ~$.2564/share Cash Value.

Yes I believe these numbers have gone down some as the companies revenues suck. However their asset/debt ratio is very nice and intriguing and with the position they are at now, trading under $.05/share, this is a big time target to be acquired by a larger more successful company (perhaps WRES or someone else).

$WRES is clearly doing much better than $ESCR and $ESCR does have assets that could possibly interest $WRES who could possibly operate them more effectively then the current $ESCR staff.

In my opinion, $ESCR chose to delist from the NSDQ because there is an acquisition play involved, whether it’s with $WRES or not. With the timeline of events above, it is in my opinion that it has a high chance of being with $WRES but this is just an assumption based on the events.

Trade at your own risk and do not use this as investment advice. All of these opinions and assumptions are my own and my own only.