Ann: Acquisition of Interest in GOM - Investor Presentation, page-40

Lots of criticism of this deal, most of it fair, but we also need to consider this:

Karoon needed to replace its declining field production & has taken the opportunity to do so. The valuation was low because of this (despite SP hitting recent highs). We can be concerned at the short term decline in share price & the raise price, but Karoon had to move on from having a single asset & Neon (production) is too far into the future to wait for.

If as hoped for, production in GOM also increases through development & reserves increase through exploration, Karoon becomes a cash cow again & has options with regards to Neon development (go it alone, or bring in partner). It is likely any dividend is delayed by six months (pending oil price & bedding down of this acquisition).

Expect a dividend October next year or Feb 25.

At oil price at/around $75, this would remain undervalued at the raise price & recent highs.