Market value isn’t the only way to estimate a stock’s worth, Cramer told viewers on Tuesday. Sometimes what one company will pay for another is an even better method.
That’s become especially true of late, as big oil and gas firms have been making bids on US unconventional natural gas shale assets. And a lot of these companies have been overseas players looking to get a leg in here.
Take Atlas Energy , an independent natural-gas producer with a trillion cubic feet of proved reserves. Atlas operates in Appalachia’s Marcellus Shale, Tennessee’s Chattanooga Shale, and it’s the largest driller in Michigan’s Antrim Shale and Indiana’s New Albany Shale. Just this month the company sold a 40% stake in 300,000 of its 580,000 total Marcellus acres to Reliance Industries, the big Indian energy firm, for $1.7 billion. And then the companies bought together another 43,000 acres last week.
Cramer called it a “breakthrough deal” and wanted to know more about it. That’s why he invited Atlas Energy Chairman and CEO Edward Cohen to the show. Watch the video for the full interview.
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