General Discussion, page-1714

While there's still a good chance of a higher/increased bid, there is also an increasing probability of getting much less than 50c.

Numerous posters have said they would vote no. What happens if it gets to a vote at 50c and they do what they said on HC and they vote NO. Are there enough shareholders with an inclination to vote down the offer - possibly. If the takeover doesn't reach the required thresholds to be implemented under the scheme of arrangement - it fails. If the vote is really close TLEA may toss in an increase to swing a few voters. If the voting isn't close, TLEA may just walk away or at least pretend to walk away (possibly coming back a few months later with a new bid relative to the share price post the bid failing). Also if TLEA can't get the regulatory approvals required, the bid also fails.

What happens if ESS gets to the point where TLEA walks away?
1. Any takeover hedge funds who entered will look to exit once takeover speculation disappears. They took a calculated gamble and lost they are most likely the bulk of the current buyers. Holding a non-takeover candidate isn't within their mandate so they are going to be sellers at pretty much any price they can get. Perhaps 10 to 20%+ stock hitting the market is going to knock the daylights out of the price.
2. I suspect a whole lot of shareholders have lost confidence in management. They might stick around for the takeover payout, but if the takeover falls over they would also be inclined to bail and take the loss (or limited gain) and move on to greener fields with management they can trust (and there are some quality management teams out there in other outfits).
3. If TLEA does consider a 2nd offer, it will want to knock the pre-2nd price down to the maximum extent possible.
4. ESS is faced with the problem that including working capital they need something around $350m get into production. Extremely large capital raises are difficult to get off the ground and even when they do occur, they tend not to happen at anything close to the current market price. The new capital supplied in the capital raise looks to screw over existing shareholders as a way to improve their returns.

Could ESS become the equivalent of Canada's Critical Elements where the Rose project had their PEA in November 2011. Fast forward just over 11 years and a few feasibility studies and their 1 Feb 2023 update noted they were back drilling, doing FEED (front-end engineering design work) and working towards a FID. Finance for Rose is still to be sorted and off-takes are still available to assist this. Where would ESS's share price head if the pioneer dome project stalls for 5+ years?

I hope for existing shareholders sake that this takeover through a scheme of arrangement doesn't get to the point of TLEA walking away, but to suggest there is almost no prospect of less than 50c is IMO a big mistake.