You make some fair points, I suppose another benefit to...

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Jeffro1990

547 Posts.

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17/01/23

09:37

Post #: 65726327
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Originally posted by qwert0: ↑

Two weeks ago our shares were sitting at 32c. Thanks to the board's decision to entertain this scheme of arrangement our shares have increased by over 50%.

Presumably the bid was made on the condition that it would receive board approval. Hence the board had a choice to either reject the approach and have our shares languish in the low 30's, or recommend the bid and see our shares jump to the current level.

The timing of the scheme is such that a shareholders vote will only happen after the scoping study has been released and probably the mining license granted.

There is a reasonable chance that a bidding war will emerge and that the final offer will be much higher than the current offer.

In the end, shareholders will have the final say as to whether or not they want to take a small profit now or reject any bid and hold on for a much greater return in a few years from now.

You could argue that if the board had decided not to take advantage of this situation and denied shareholders this choice, they wouldn't be seen to be acting in our best interests.

Hopefully the scoping study will provide us with a NPV for both a full plant scenario and a DSO operation. In my opinion a DSO operation could get underway quite quickly once the mining license has been granted. It would take minimal upfront capital and it would potentially return billions of dollars in profits. Furthermore, we know that ESS management can successfully complete a DSO operation because they've done it before.

I suspect that once they've read the scoping document, many shareholders won't be willing to accept a bid of $200-$250m, let alone $130m.

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You make some fair points, I suppose another benefit to recommending a binding arrangement before receiving the scoping study is that if it comes in looking less than favourable (I don’t expect this to be the case) then IGO/Tianqi are locked in to the purchase at .50 which is then sure to get a yes vote.

Either way, I’m waiting it out to see what happens, same as you I assume.

ESS Price at posting: 49.0¢ Sentiment: Hold Disclosure: Held
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