What to Do With PrimeWest

Article Excerpt

PRIMEWEST ENERGY TRUST $25.10 (Toronto symbol PWI.UN; SI Rating: Speculative) is now the subject of a $26.75 per unit cash takeover bid from subsidiaries of the Abu Dhabi National Energy Co. After merging with Shiningbank Energy Trust (a recommendation of Canadian Wealth Advisor) in July, 2007, PrimeWest became Canada’s seventh-largest energy trust. We liked its strong cash flow and low payout ratio when we recommended it in our September, 2007 issue at $21.93. That’s a gain of 22% on the bid price. PrimeWest’s board of directors has approved the offer. The company’s units are trading below the offer, so a competing bid is unlikely. We’ll say more as needed, but for now PrimeWest is a hold. hold…

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