http://www.smh.com.au/business/caltex-decision-due-20091202-k4cy....

http://www.smh.com.au/business/caltex-decision-due-20091202-k4cy.html
Caltex decision due
JAMIE FREED
December 2, 2009 - 8:15AM


The competition regulator is due to hand down its decision on Caltex Australia’s proposed $300 million acquisition of ExxonMobil’s Australian petrol stations today after months of deliberations.

The deal had been struck in May, but in September the Australian Competition and Consumer Commission issued a detailed statement of issues critical of the acquisition and called for more comments from interested parties.

On Monday, Macquarie Equities analyst Adrian Wood said he was "cautiously optimistic" that the deal would be granted the green light in some form and ran his numbers based on the assumption that Caltex would be allowed to buy 250 out of the 302 Mobil stations for a purchase price of $250 million.

In that case, the deal would have an internal rate of return of more than 20 per cent and add $1.47 a share to Macquarie’s valuation of Caltex.

Wood said that if the deal was blocked, it would be harder for the Government, in the interest of national security of supply, to push Caltex to buy Australian refineries that ExxonMobil and Royal Dutch Shell looked increasingly likely to divest in the future.

As for other potential growth options, Caltex is not the preferred bidder for Shell’s New Zealand petrol stations and stake in that nation’s only refinery. It remains unclear whether it has expressed interest in the purchase of ExxonMobil’s NZ petrol stations and refinery stake, which are also on the market.