Firstly let me appologise for my tardy responses in this discussion. My travel schedule has been very hectic in recent weeks and hardly have time to even read HC posts, let alone construct an intelligent response.
I do understand where you are coming from and don't entirely disagreed. My comments reflect my experience of how the market works generally.
While it's very common to fear the lowball takeover offer, the mechanics of the market don't really make it that easy to execute it that way. Firstly, the current price indicates that EER isn't yet in play. Two key shareholders have no intention of selling so irrespective of any persons desire to run a cheap bid, there is no chance of it going anywhere without both key holders being in agreement. Neither would sell cheap in my opinion, and why would they?
As for one of the two launching a bid, well, the above still holds true. They would need the agreement of the other. I'm sure either would give up their stake cheaply just so the other could have the whole pie to themselves. Remember than in order for a bid to take our shares they need to get to 90% and they also need to convince the court that the offer is fair and reasonable.
The moment it looks like EER is in play there will be many spotlights shining on it from places as far away as china, india and switzerland. The story is known to those that will ultimately matter but many more will know when it is in play.
Coal might be a little out of favour at the moment and the lack of support for the SP refects this (being a non producer of something that is going down in value hits hard I'm afraid), but personally I'm more confident about thermal than coking coal going forward. China's building pace may slow and they may need less steel but the cummulative consumption of power from all that has and is still being built in China and India lives on and power consumption will continue to grow at a much faster pace than steel consumption IMO. EERs 1.7B+ tonnes of thermal coal will be worth a lot more in the future than it is today. As always, just a waiting game.
EER Price at posting:
12.0¢ Sentiment: Buy Disclosure: Held
