re: informed opinion instead of disinformation
Hi zork,
The sale process is slightly unusual because of the sheer number of interested parties. My sense is that the process that Carnegie Wylie have devised is designed to encourage a bidding war. The strategy reflects a high degree of confidence in the value of PHY on behalf of its management and Carnegie Wylie.
Regarding your comment about carbon credits, we need to keep in mind that carbon trading is very much in its infancy, and no renewable company (including most EU companies) is expecting to make serious money from selling carbon credits for a few years. PHY itself wont have a critical mass of completed carbon credit generating projects until around 2008.
One of the key reasons that so many parties are showing an interest in PHY now, is that they want to takeover (or take a stake in) PHY before its carbon credit potential is fully reflected in its market cap.
Regarding the expected size of the gloabal carbon trading market by 2010, I've read reports that paint two scenarios. The worst case scenario is that the US fed govt (supported by Big Oil/Coal and other conservative govts such as Howard's) succeeds in stifling carbon trading over the next 5 years such that it remains essentially a European thing + a few CDM projects in non-annex 1 countries. In such circumstances, analysts have said the market could be as small as $US500bill.
A second scenario is that Japan, Canada, and progressive US states such as California and New York link up to the European trading scheme in 2-3 years. If this happens, the global emissions market by 2010 could easily be worth US$2trillion. This scenario would get a major push if the democrats win back the White House in 4 years.
I think in the medium term, Aust under the Libs will follow the direction it thinks the US is taking. In the longer term, it will do whatever it takes to keep our exports competitive. Ironically, this may demand carbon trading (see my earlier posts).
The bidders that have been selected by PHY will each have their own opinions on the value of carbon credits by 2008, and will have determined their valuation/risk weighting accordingly.
There is much guess work here, but I think an increasing number of intelligent investors and even a few big carbon emitters (cf. BHP) are recogning that the present state of affairs is unsustainable even in the medium term, and that carbon/emissions trading provides the key to solving much of the world's most pressing and immediate environmental problems.
