setup to fail - academica mentoring...setup to fail: how institutions use an architectural and...

ATLAS CONSULTING

SETUP TO FAIL:HOW INSTITUTIONS USE AN ARCHITECTURAL AND DESIGN ADVANTAGE TO WIPEOUT RETAIL INVESTORS

PRESENTED BY ATLAS CONSULTING

ATLAS CONSULTING

IN OIL & GAS, DEBT IS JUST A PART OF THE GAMECONCEPT:

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SOURCE: THE WALL STREET JOURNAL

SOURCE: OILPRICE.COM

SOURCE: BLOOMBERG

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SOURCE: BLOOMBERG

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BUT GIVEN THE RISKS, WHY DO INVESTORS CONTINUE TO LEND TO OIL & GAS

ENTERPRISES?

QUESTION:

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THE CAPITAL STRUCTURE

ANSWER:

THE CAPITAL STRUCTURE ESTABLISHES A RECOVERY VALUE “ORDER”, SHOULD THERE BE

A CATASTROPHE

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CONCEPT:

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OFTEN, THIS “CATASTROPHE” IS CALLED A BANKRUPTCY OR A RESTRUCTURING EVENT

SOURCE: STAR-TELEGRAM.COM

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THIS RECOVERY VALUE “ORDER” BECOMES THE FOUNDATION FOR ANY AND ALL DECISION

MAKING BY PARTIES INVESTED IN THE ENTERPRISE

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CONCEPT:

THE DECISION MAKING PROCESSES [AND EXECUTION] AT THE ENTERPRISE BECOME

DIRECTLY CORRELATED WITH INVESTOR VIABILITY, GIVEN THE STRATEGIC

INTERDEPENDENCE OF THE CAPITAL STRUCTURE

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AS OIL & GAS FIRMS BECOME MORE INDEBTED, THE CAPITAL STRUCTURE ORDER

BECOMES MORE AND MORE IMPORTANT

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UNFORTUNATELY, IT ALSO BECOMES MORE AND MORE COMPLEX

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SOURCE: BLOOMBERG

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SOURCE: BLOOMBERG

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THIS COMPLEXITY RESTRICTS PARTICIPATION IN THE UPPER LEVELS OF THE CAPITAL

STRUCTURE TO INSTITUTIONS AND WEALTHY INDIVIDUALS

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…WHICH MEANS RETAIL INVESTORS DON’T GET ACCESS TO THE PARTS OF THE CAPITAL STRUCTURE WITH “RECOVERY VALUE” IN A

CATASTROPHIC EVENT

SOURCE: SEC FILINGS

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IN OIL & GAS, BANKRUPTCY IS JUST A PART OF THE GAME

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CONCEPT:

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SOURCE: BLOOMBERG

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BANKRUPTCY IS AN EFFICIENT PATHWAY FOR TAKING OWNERSHIP OF ASSETS…

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…FOR THOSE WITH ACCESS TO THE CAPITAL STRUCTURE VEHICLES WITH RECOVERY

VALUE

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REMEMBER, PARTICIPATION IN THE UPPER LEVELS OF THE CAPITAL STRUCTURE IS

RESTRICTED TO INSTITUTIONS AND WEALTHY INDIVIDUALS

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RETAIL INVESTORS, OR JUNIOR SHAREHOLDERS, ARE EXCLUDED

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IN THE LAST 25 YEARS, THERE HASN’T BEEN A SINGLE MEANINGFUL JUNIOR SHAREHOLDER

VICTORY

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DESPITE MEANINGFUL EFFORTS

SOURCE: THE NEW YORK TIMES

SOURCE: NATURAL GAS INTELLIGENCE

SOURCE: REUTERS

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SOURCE: UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS [HOUSTON DIVISION]

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WHICH HAS BEEN CATASTROPHIC TO JUNIOR CAP STRUCTURE MEMBERS

CAP STRUCTURE ARCHITECTURE AND DESIGN INHERENTLY DISADVANTAGES RETAIL INVESTORS

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CONCEPT:

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SOURCE: LAW360

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SOURCE: BLOOMBERG

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SOURCE: LAW360

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SOURCE: BLOOMBERG

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ATLAS CONSULTING CAN HELP BALANCE THE INHERENT DISADVANTAGES IN OIL & GAS

INVESTING

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USING A SUBSCRIPTION-BASED DELIVERY PLATFORM, ATLAS CONSULTING CAN HELP

YOU TAKE A DATA-FIRST APPROACH TO CAPITAL STRUCTURE DEFENSIVE INVESTING

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OIL & GAS EXPOSURE CAN BE INCREDIBLY LUCRATIVE AND DOESN’T HAVE TO BE

DANGEROUS OR DISADVANTAGED

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DEVELOP A METHODOLOGY, BE DATA-FIRST, AND PARTICIPATE IN ACTIVE STRESSED-DEBT AND STRESSED-EQUITY CAMPAIGNS WITH

ATLAS CONSULTING

THANK YOU

ATLAS CONSULTINGAtlas Consulting is an energy-focused risk-management and consulting firm that specializes in cap structure management and arbitrage. Atlas Consulting specializes in private company lifecycle management, up to and including taking companies public, and in helping consult publicly traded companies ranging in market cap from $100 million to $500 million. This includes helping with overall strategy, helping with capital structure management, helping facilitate liquidity, helping facilitate Joint Ventures and broader M&A, and helping restructure business segments if necessary. Atlas Consulting has a specialization in deal flow management and is often the referring and closing source of Joint Ventures and broader M&A.

website: atlasconsulting.venturesemail: sales@atlasconsulting.ventures