Well there goes the GKP bubble bursting before our eyes as the company finally bow to market pressure and release an RNS pouring cold water on the weekend speculation as reported in the weekend press. Lot of anger out there as the email in-tray begins to fill up.
Mark Lefty (The Independent) and the media et al reported that GKP had been in negotiations with several Big Hitters and that an auction may develop where these multi-nationals begin a bidding war for the company, £8 was widely quoted this morning online by the wide-eyed and gullible as each and every one of them was suckered in to what can only be described as a Professional City wide ramp. While there’s no doubt that GKP have been in some form of on off unofficial negotiations over the last year or so there’s no doubt that there is NO official negotiation being conducted. If there was an officail approach made then it would have to be reported within minutes of the approach.
So lets take a quick look at GKP. Yes they have billions upon billions of barrels of oil. The share-price is certainly many times under-value so why is it that they are trading at such low levels? I’ve told the blogosphere many,many times the company are operating in a politically volatile region in the Middle East, Kurdistan, if they were not in Kurdistan, lets say Russia the share price would be in excess of £10.
There’s only two ways to look at it. Invest and hold or trade them as and when they spike which they always do. Now it seems to me that the powers that inhabit the City of London are currently using the latter as their strategy. How many PI’s have just been caught on this recent spike?
It’s a funny old world; the press has led PI’s a merry Morris dance once again. Who are the gainers? Market Makers, Professional City Institutions, with a handful of PI’s. I expect that the PI’s who bought in will be emailing enmasse “those” newspapers, media outlets responsible for todays spike. I wouldn’t bother if I was you they are completely immune from any form of censure. That’s the way the C(r)ookies crumble in the City of London. Hence the new site launch!
PS A salutory lesson for Christmas.