Incredulous, page-9

Article from todays.......Australian.com.au

AWE to endorse Mitsui’s offer as Kerry Stokes grabs a stake

TURI CONDON, ELIZABETH REDMAN
3-4 minutes
The AWE board is expected to endorse the 95c-a-share bid made by Mitsui to buy the West Australian gas producer after a major investor emerged on the company’s share register.
DataRoom understands that Kerry Stokes took a stake in AWE with a holding built up through Deutsche Bank and an equity derivative position.
Deutsche Bank declared on December 11 that it was a substantial shareholder with a 5.42 per cent stake in AWE.
It is thought the bank bought the stock, through a derivative holding, at between 63c and 73c, shortly after China Energy said it would offer 71c a share in cash for the business. The Chinese group then upped it to 73c, before Mineral Resources came in at 87c in a cash and scrip bid.
However, Deutsche Bank told the ASX on January 15 that it was no longer a substantial holder of AWE. The likelihood is the stock was transferred back to the direct account.
There was speculation last night that Mr Stokes was that account holder and so far had made a handsome profit. The holding is now thought to be between 3 per cent and 5 per cent.
AWE closed yesterday at 98c, down 1 per cent, after it shot up on Monday when Mitsui’s 95c-a-share offer arrived and created a three-cornered bidding war.
Seven Group last year outlined a desire to boost resources investments in a bid to take advantage of the commodity cycle uptick as the company looked to diversify away from media.
One of Mr Stokes’s major investments, Beach Energy, will today take control of Lattice Energy, which is the joint venture partner with AWE in the lucrative Waitsia gasfield.
Mr Stokes is Beach’s largest shareholder with a 25.5 per cent investment. The Waitsia asset is operated by AWE.
Observers say it is in Beach’s best interest to have AWE controlled by a favourable party given the close connections on Waitsia.
Waitsia now has about 820 petajoules worth of gas reserves, which makes it one of the largest fields in Australia.
The first theory behind Mr Stokes’s position is that it was Beach positioning itself for a takeover of AWE or that it could be a potential blocking stake if the ultimate winner of the battle for AWE was not viewed favourably by Beach. The third theory is that the stake is a sign of the value that Beach and Mr Stokes put in Waitsia.
There is also the theory that if Mitsui wins control of AWE, given its track record of partnering assets in Australia, it could bring in another partner, which could be Mr Stokes.
AWE will announce today that its board supports the Mitsui bid and will recommend it to shareholders.
That decision will give Mineral Resources three days to match the Mitsui offer.
AWE will also release its quarterly production report today.

My Theory.......
I have wondered where the shares went to after the Deutsche bank disclosure.
IMO all orchestrated and a 'white knight' for the Mineral Resources bid.
The gas is only a part of bigger plans already articulated by MIN.
Expect a matching bid from MIN.