Ann: Notice of Annual General Meeting/Proxy Form, page-17

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wombat777

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25/10/20

19:21

Post #: 48370160
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Originally posted by Scarpa ↑

I read the paragraphs as ADN are likely to be open to a JV, and one way to do that to maximise SH value is allow a JV partner the option of buying into the company itself to get that ownership. In other words having a JV partner with share ownership in ADN itself - therefore in effect what you have established is an incorporated JV by ADN still being in existence - and obviously this avoids dillution itself.

The alternate JV arrangement is having an unincorporated JV where the JV partner in effect gets a 50% stake n the project itself but in an unincorporated JV structure it also means potentially the JV partner can sell the product separately. I suspect what ADN wants is a incorporated JV structure, which mean the JV partner is responsible for helping sell 100% of the products produced, and finding markets for products, as against simply taking a 50% stake in an unicorporated JV, meaning ADN still has to find its own buyers for the 50% of the project it still owns.

Examples of unincorporated JVs are rampant in the LNG sector, so people may want to have a look at how they operate to get the feel of the difference between a incorporated JV (here through a JV partner taking a stake in ADN) as against an unincorporated JV.

Effectively looks to me as ADN keeping options open for long term development.

All IMO

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I see the change as pure takeover defence, nothing to do with JVs.

The Great White (nee Carey's Well) project is too nimble to warrant an additional JV partner. CAPEX is very low relative to current market cap. ADN together with MEP will be comfortably able to get this up and running.

The only area where we may see some form of additional JV is for HPA. Understanding is that it will be an alliance/collaboration of some form.

ADN Price at posting: 14.0¢ Sentiment: Buy Disclosure: Held
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