fallacy of liquidity - cer vs cnp, page-36

Apples,

Even so, as I reiterate in point 2, CNP cannot offload CER just yet.

CNP only had $4b in equity as at 30 June 08. There are $2b in writedowns for the half year ending 31 Dec 08.

CNP need CER's equity on its balance sheet in the meantime. It cannot afford another $3b hit.

Seperation will come in the meantime through the termination of hedging agreements and both companies having a mutually exclusive board.

CNP would need to relinquish its right to vote at CER meetings perhaps.

To be honest, I dont know how the sepearation process is going to evolve from here.

Hopefully we'll hear more in this week's HY reports.