In January the independent expert gave Redbank (net of debt) a value of $41.5-53.5m - say 5.5.cents per share.
The debt is not due to 2018 (for 52.9m) and 2023 (for 189.1m) so no immediate issues there.
In addition there are:
* 78.5m of carried forward tax losses ($23.6m tax shield) * Unstated franking credit value
As a general rule the ability to control something (i.e. Redbank) has some value because it is an option on things getting better. In Redbank's case the obvious way things get better is via enhanced plant performance - but there are other ways too.
Simply being an incumbent coal fired generator in a world where no new coal fired generators can ever be built again has some value.
Likewise there is the possibility of selling it to the Feds so they can shut it down and get a pretty simple way of reducing carbon.
AEJ Price at posting:
8.6¢ Sentiment: Buy Disclosure: Held
