‘EXCITING TIME’ COMING FOR GRAN TIERRA SHAREHOLDERS AMID UNCERTAINTY: ANALYST

It’s crunch time for Gran Tierra Energy Inc.’ s management team as a key shareholder is calling for its ouster, which potentially leaves the company vulnerable to a takeover.

Shares of the South Americafocused company are up nearly 13.5 per cent on the TSX since April 21, when West Face Capital Inc. announced it had acquired 9.8 per cent of the company and was seeking to install veteran oilpatch executive Gary Guidry as the new chief executive along with a new slate of six independent directors.

The Calgary-based company’s board has been cool to the suggestion, but West Face has reiterated its call for “sweeping changes,” saying the current management has “no coherent strategy,” despite $330 million in the bank and no drawn debt.

Canaccord Genuity Corp. analyst Christopher Brown thinks the stock rally is being fuelled by the prospects of either a new management team or a takeover offer from an international player at- tracted by the company’s liquidity.

“As both outcomes could potentially result in a higher nearterm share price, this could be an exciting time for Gran Tierra shareholders,” Brown told clients in a report Tuesday.

With “little or no guidance by the existing management team,” Gran Tierra presents a “rare opportunity for a potential suitor to step in and capitalize on uncertainty,” the Calgary-based analyst said.

“We believe potential offers would likely be made in the near term, as a favourable vote for the new management team is a vote against an opportunistic takeover offer.”

Gran Tierra has not set a date for its first-quarter earnings announcement or annual general meeting. Canaccord is one of 11 analysts with a hold rating on the stock; the other nine have a buy rating, according to Bloomberg data. Analysts’ average 12-month price target is $4.74, which is near the company’s current level.