Chesapeake Energy Corp (CHK)

[LouisDesyjr]

CHK isn't filing for BK yet

I find it hard to believe that after eliminating dividends on the convertible preferred of $43 million per quarter, that CHK is going to spend $500 million to pay the bonds at maturity.

The borrowing base for the line of credit gets reviewed April 1, 2016; so they might use the line of credit to repay the bonds.

IF this happens, it will be great for the bonds, but does nothing to help the common shares and the common may still continue to decline down to zero.

I expect it is no longer a question of If CHK will file bankruptcy, but a question of when.

Louis J. Desy Jr.


Disclosure: I hold March 18, 2016 $1.00 put options and may buy Jan 2017 or Jan 2018 put options.