appropriate value? $1-68??, page-19

While it may be a little off-topic for this thread title, I just wanted to share my thoughts on possible outcomes. My reading of the various announcements is that the company has not been satisfied with the bids for the sell-down of a Crux interest. I believe that they are looking to minimise the diluted impact on total shareholder value as they see it from the process. Therefore, we are likely to see a range of solutions to the project financing requirement for Crux.

My expectation is that they will attempt to raise the maximum amount possible through:

1. outright sale of the remaining 15% of ACP/41; plus

2. a convertible note issue subject to conversion at a significant premium to the existing equity price with the investor being Shell; plus

3. a sell down of 25% of Crux as initially envisaged, but at a material discount to the earlier offer from Mitsui.

One of the reasons for broker commentary suggesting a larger selldown percentage for Crux is that NXS has to raise enough new funds to finance its remaining share of the project. So less remaining percentage means less call on funds to equalise the lower sales proceeds. However, if offers are too low it will significantly dilute long term upside. Beneficiaries of a structure similar to above will be long term investors including management.

regards
DF