Shareholders of the old Penn West have made it clear that they would like a name to change in the company. The proposed name as determined by the board of directors will be Obsidian Energy. This is something that sounds a little better for the new era of business that we all find ourselves in.
The company has been undertaking a number of actions to help it get its feet under itself again. In other words, they have been working diligently to make sure that they are able to reshape the company to make it more sustainable for the future. Even though this does mean shrinking down the business in the near future, that is an acceptable outcome for ensuring that the long-term sustainable growth is possible for them.
Obsidian has several subsidiaries including Canetic Resources Trust, Endev Resources Partnership, and Sifton Energy Inc. However, the new Obsidian Energy has sold off a number of assets that it used to hold in order to reduce its debt load. That debt was as high as $3 billion dollars in 2014, but now it has shrunk down to a much more manageable $384 million in March of 2017. That is something that can help the company use future inflows of cash for its own growth and sustainable future.
The number of employees working for the company has been shrunken down to increase the chances of sustainability in the future as well. These types of actions are frequently necessary when there is some call for restructuring in the air. A company has to make the choice to either do some trimming of its costs, or they have to face the reality that they will not be a viable business in the future. The choices really are as stark as that. See This Article for more information.
We are all lucky to have a company with smart people at the helm of it making those tough choices. At least in this case, it does appear that the new Obsidian Energy will be making the right calls to protect the shareholder value that does still exist in the company. That is not something that all brands have the courage to do. We do know that this brand is at least going to make every effort to stick around.