Givot Olam Oil Exploration LP (EM)【GOOXF】株式ニュース

Not to be confrontational, but my understanding is Givot Olam general partnership operated a well at a loss for 4 years, using limited partnership money, so the generals could collect royalties, which have to be paid regardless of profit or loss on an operating well. As needed, the generals loaned money back to the limited(s), so the limited partnership could keep paying to keep the well, operating at a loss, open and the generals would keep making the royalties off an operating well. This arrangement is truly evil, but apparently legal. It ended 4 years later when the limited(s) ran out of money, while the generals pocketed the royalties, and the generals could no longer attract new investors into the limited partnership.
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Obviously, the limited partnership is now in the hole in terms of debt, to the general partnership The lesson is, if entering a partnership agreement, you do not want to be the limited partner, you want to be the general partner.

Eventually, the general partnership tried to attract new investment. No one wanted the limited partnership shares since they knew they were worthless. So they offered shares in the general partnership. This almost worked, since the general partnership has value, but ultimately the new (General Partnership) investors backed out.

Incidentally, the IPO price in 1993 was about $10 US (40 shekels) for 100 share partnership unit (1 partnership unit). The partnership unit trades on the TSE in shekels, the shares trade on the pinks in the US, with 1 partnership unit equaling 100 shares. Since 1993, there have been two 10 to 1 reverse splits, which means old numbers compared to new number have a factor of 100 difference in them. So in todays dollars, the IPO in dollars was, 1 share was $10, now worth 25 cents, and 1 partnership unit, 100 shares, now worth 162 shekels (originally 4000 shekels). That's a loss of about, oh, say 96%.

Now, if you buy US shares (GOOXF), you are paying about a 55% arbitrage fee, US shares/US dollars to Israeli limited partnership units/shekels. My guess is most don't know what they are investing in when they buy GOOXF, so the arbitrage fee they are truly paying isn't realized, until they try to sell and find there is a 50% spread between bid and asked.

I don't think anyone is buying GOOXF, the limited partnership shares, these days. But I guess people are willing to trade anything as GIVO-L.TA is still actively traded, no idea why.

Givot Olam does have value, they have a real petroleum field on their hands, that perhaps could support 40 commercial wells or more. They also have the worst management imaginable, making the company, as a whole, pretty much worthless. They will NEVER pay a dividend, but you might be able to ride the GIVO-L.TA limited partnership up and down with public sentiment, as I don't really think investors in GIVO-L.TA have the foggiest clue what they have bought.

Investors should at least understand the returns are capped by the partnership agreement, after Givot Olam has paid back a certain percentage of what they borrowed from the limited partnership, the limited partnership IS DISSOLVED, ie, at the very best, you get X number of dividend checks, then the stock goes away. I used to know what the trigger price was, but I no longer recall it. It has traded at least one time above the trigger price that I know of.

I haven't seen much about Givot Olam in the past several years, you might want to check their website to see if they bothered updating it. If it hasn't been updated in a half dozen years or so, I'd recommend you stay clear of this. Their only strength is their name and an investing public that doesn't know exactly what they are buying.

When Givot Olam was actively trading, and I researched the above, it was just flat out unbelievable, especially when it traded greater than it's maximum legal lifetime payout requirement. So I don't expect anyone reading this to believe it, either. Please do not believe me, rather: Check their website, be sure to look at the date on the website, and realize no documentation has been posted on the website for years, then you make you own choice.

And yes, I have read the partnership agreement, have you? IF you can still get a copy, read it before you invest.