Re PHY valuation: Carnegie Wylie have fed the media a figure of $6.50 per share ($980mill approx). This figure was established by multiplying PHY's capacity (from the perspective of a buyer) by the sale price per MW of renewable capacity recently established in Europe in Canada.
While this price is plausible, if you read my posts of about 1 month ago, you will see why I don't think PHY should sell for the same price per MW of capacity as its European counterparts. I argued then that a slight discount is warrented because, among other things, Aust is not yet signed up to Kyoto.
Applying this discount, I have a high degree of confidence that the final sale price will be *at least* $800 mill ($5.30 per share). It is my expectation that PHY management will reject any bid under this figure (keep in mind that this is not a sale of necessity, and there are multiple bidders).
PHY's bidders know that PHY will likely be worth A$3bill+ by 2010 (with much of the growth financed from free cash flow). Make no mistake, PHY is hot property at present.
I look forward to seeing who's crystal ball is closest to the mark.
