LCX is quite small and shares have been struggling. Management was looking for a way to enhance value. With no sale of the company, the decision to sell assets to an unnamed buyer for $60M (US$) was seen as the best way to create value and distribute it to shareholders. Insiders own 19% of the company so they will get cash too. LCX has also announced a share buyback. The 90c distribution will still leave the company essentially debt-free and it still has a $50M credit facility. It will still have 1,700 b/d of production, and we would expect it to grow production internally or seek some small acquisitions for growth. But following the distribution the market cap will be quite small here, so it may take a while for investors to reexamine the remaining company. Share price will likely decline by close the distribution amount.
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