Whilst I don't think we could rule this out, it's difficult to...

Whilst I don't think we could rule this out, it's difficult to see where the benefits might lie.

CER holders would argue that they are currently limited against problems in SuperLLC and by merging with CNP, they in effect now co-own the entire risk for the group. If SuperLLC falls over, CER will probably be OK in the current arrangement. CNP holders on the other hand would welcome the lower LVR and lower risk that the merger would bring.

CNP holders wouldn't be happy about diluting their potential upside though. If CER does well, it still has a limited upside potential - at the peak I think (from memory) it traded above $2. When CNP returns to health, the upside potential is a lot greater. CNP holders would see this considerably diluted in a merger.

I'm not sure there would be much cost saving through synergies either. CER doesn't have any staff as such. CNP already manages the beast.

We would certainly get some simplification through only requiring one board and there would be some administrative reduction from having one entity not two.

We hold CER and CNP for different reasons and would not be in favour of a merger unless the company could outline some very good reasons to do so.

Having said this though, there are some other options, like putting ownership of the properties in two entities (one US and one Aus) and management in another, which might be attractive if they were put to shareholders.