Ann: Company Update, page-50

Some good insight from the webinar. My takeaways:

• Offer was for Blackspur
• Acquirer was a roll-up play with the intention to list on the TSX
• The plan was to distribute 80-90% of the proceeds to holders and keep the rest in the vehicle
• Glenn alluded that the price was lower than TSX comps of 2.5-3.5x EV/EBITDA.
• If Glenn is also saying we're worth 1.5x EBITDA then we have a range. Let's say 2-2.25x. Using CE1's definition of EBITDA of A$66m then roughly that implies an offer price of $132m - $148m (roughly).
• For those that want a share price equivalent, the above works out to 21.5c to ~24c, plus we keep Montney
• If the above came off then using the lower bound 80% distribution we'd get AT LEAST a 17c distribution and we'd keep Montney - I'd be happy with that
• Management also said that they won't 'go it alone' for Montney, so it's JV or sale. JV makes a bit of sense in the event of a large distribution for Blackspur as the proceeds for selling 50% can be put towards the capex, so it's a free carry to production.
• Glenn also made some silly comments on buybacks and referenced Whitehaven and New Hope saying it hasn't increased or protected the share price. Let's not forget that coal prices have crashed - no buyback could hold the weight off that. Anyway, the free finance lesson is that if the value of the Group is under valued and we're not investing in growth, then buying something for cents in the dollar is good capital allocation. But I'm happy to take capital distributions so all is good. Just be better informed.