I could be wrong but I don't think the capital cost of an HHR takeover, by RR, is deductible for RR - ie this type of capital cost can't be offset against their taxable income, versus their negotiated farm-in capital costs which can be. For RR to get that deductibility any takeover would have to be via further agreed farmouts of all or part, I think. What could such terms look like - well not less than the 60% terms but also I believe HHR insiders all turned down their chance to partly sell down into the 4c bookbuild a while back. They all expected greater longer term returns down the track imo.
An immediate share price jump is appealing, but then I don't want too much upside given away either. It's a good quandary to have. Full steam ahead with our 40% but we have options - the ability to be nimble if we must, or if others make it enticing enough.
Can you mention where you picked up your RR £700m 2024 figure from ?
HHR Price at posting:
2.9¢ Sentiment: Hold Disclosure: Held
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