At the end of the day the LCE explanation doesn't really do much...

At the end of the day the LCE explanation doesn't really do much and is only playing with the wording of the announcement. Yes the board didn't mention the transaction at the AGM, however due to confidentially in M&A transactions and the fact that the contract hadn't been signed they could not make mention of the transaction. This is pretty common sense. The electrical business is just an investment held by ECL's LIC so its no different to selling ASX listed shares. i cannot see an issue with this and the fact that they have from day 1 advised that they want to be an LIC. My belief in the reinvestment "endorsement" is to 1. confirm that the cash will not come out (possibly to soften the SP) and 2. to get the backs up on some holders who may decide to exit. We can see that LC has bought up just after the announcement!

The issue really comes back to the key points;

1. The performance of ECL on the investment side has been disastrous and I believe since inception it has netted only a loss! Now to tip in another circa >$110m really!
2. ECL is now holding effectively cash and significant franking credits. This is the ideal opportunity to wind up like so many shareholders have been pushing for, yet LC for some reason doesn't want this which is perplexing, or she is just not sharing what he true plans are. Remember they said they were looking at acquisitions, they never said the electrical business was for sale yet it did occur. A significant portion of her holding is held in her Super so winding up would be favourable from a tax perspective. The only thing I can attribute this willingness to take the cash and reinvest is to hold the SP down while she accumulates leveraging her benefit.

The consultant that ECL engaged a couple of years ago I am sure has provided a structure that would provide significant benefit. Maybe even making a Takeover offer.

LCE holds just over 12%, LC holds just over 51%, (I suspect this has changed) there is a block of holders that have been pushing to wind up ECL for years which holds just over 10% (total close to 75% and only 15% short of compulsory takeover). I suspect that there is a number of holders that would sell if a takeover was on offer. I suspect that at some stage the board will engage with LCE on how much will it take to get them to sell and this will be the guide for a takeover.

The longer ECL stays listed the longer the gap between where the SP is and the intrinsic value will close, on the down side!

The sale closes by February. This will occur, there is no doubt. The second payment will be by end August. I suspect that the board will be looking at what happen after August. My view we will see some changes in the share registry leading into September. This will most likely give us an understanding as to what may happen. I doubt we will see anything before that.

Do not doubt LC, she has good advisors and she will understand what will create the most value for her and as a result for the remaining shareholders!

Lets wait and see.