Ann: Ceasing to be a substantial holder, page-25

Absolutely FIRB approval will be required given the acquiring JV entity is 50% foreign owned, and Chinese to boot. I expect FIRB will waive it through, but after a respectful amount of time says they considered it properly. Regulatory approvals, including FIRB, are specific conditions precedent on the TO scheme going ahead. Shareholders won;t vote until all condition's precedent are ticked off and there is a viable scheme to vote on.

This TO was always going to be a slow burn, and there is no sensible reason for competing bidders to rush in early imo. Sensible thing is to accumulate a stake over time perhaps, but not show your hand and drive the share price up. Time, impatience and fear of no rival offer is what all bidders want to see, so shareholders are softened up to happy vote for whatever final offer price is put up for a vote. The longer ESS stays at or around 50c the better.

ESS has 7-8Mt of ore feed plus upside, inside a permitted mining lease a soon as mid year. It's the future lithium spod price that determines what ESS is worth to bidders, and what price they are willing to risk paying now. On that matter, I'm pleased to see analysts starting to walk back up the future price deck from the lows of GS et al late last year. Where GS had 6% spod-con heading for US$800/t by 2024 consensus (and they were lowest btw) conservative consensus is trending now around US$1500/t. That is the critical figure bidders will be mulling over when deciding what ESS is worth and how much they will pay.

Value is highly leveraged to the spod pice obviously. I get an extra A$500M NPV pre-tax, discounted at 8% (assuming A$250M capex and $450/t cash cost) between running US$800/t and $1500/t for Dome North. Any acquirer running spod through their own plant saves capex for small extra opex. I think A$600M is a fair Dome North discounted cashflow valuation including some extra strategic value and exploration upside chuckled in. Splitting that value 50:50 between ESS holders and an acquirer seems fair to me, considering a plethora of risks, bird in the hand and all that.

So ESS buyout at ~A$300M or $1/share is a justifiable win-win, but we won't get close without multiple bidders. If Tianqi aren't pushed, I can still see them going to 60's or 70's to get the deal over the line, especially if some large holders and arb funds get together with a blocking stake and push for a better offer. All good, enjoying the slow boat trip...