Yesterday in the thread 'Shell Energy Australia Proposal to acquire ERM Power' I noted;
"Given we are / were arguably due these dividends anyway, it is a little devious, (or a LOT devious actually) to promote the deal on the basis of a 38% premium.
Furthermore, I am uneasily conscious that this was being negotiated over recent months, during which we've seen considerable manipulation of the SP downwards from circa $2.00 at one point.
Otherwise a more truly reflective premium should have seen the offer in the $2.60 - 2.70 bracket; unencumbered by any dividends paid."
Today I see this on Commsec -Performance Chart
Chartdata sourced from ASX TradeMatch only.
EPW is ina long-term bullish pattern confirmed by multiple indicators. Specifically, a5-day moving average of the stock price is above the 50-day moving average andthe 200-day moving average is trending higher. However, the 20-day moving average is falling. While it'stoo early to predict the long term implications of this selloff, it may only be a correction within a continuing bullish move.
View EPW Charting
On their chart which I am about to post also, you will note the rapid sell down over July;
.
Very hard to overlook the Commsec analyst's uncertainty as to what might be behind this SUDDEN and DRAMATIC reversal of trend for EPW trading. (highlighted in yellow above)
Having slept on this overnight, and observed that I am not alone in the misgivings I voiced previously, (refer HC poster ksvs and others), I am increasingly concerned at ERM Power management deciding so strongly to approve Shell's offer.
Are they hoping to flush out alternative interest in the company? I mean these are senior people who I respect; heavyweights in the industry, whose judgement I now disappointingly find myself questioning.
Judging by the 22mil buyers at $2.40 and above, with only 883 thousand sellers in total, the opinion seems to be there is another chapter to be written here!
Having held since 2011, with 100,000 shares we will consider voting AGAINST this offer if it is not improved.
Of course it will be approved, because Trevor St Baker's 27.5% stake, (with others) will ensure that. And I am swift to acknowledge Trevor and others contribution to EPW's success.
I strongly object to Shell benefitting thru a reduced upfront acquisition price, by having it lessened by the value of any dividend paid to shareholders. It should be immaterial that they will say this reduces the cash holding in ERM which Shell would inherit, and furthermore they have clearly benefitted enormously through the recently shaved SP.
Perhaps as much as ACCC looking over the suitability of the deal from a competition perspective and the impact on consumers, (already cleared), another 'authority' might do well to look over recent trading on the impact of the subsequent Offer on shareholders?
Others observations please.
