I'm keen for comment on what i posted late last night .. so in...

I'm keen for comment on what i posted late last night .. so in case you missed it here it is again (please ignore if you read it last night!):


Who has had a close read? I had just skimmed it until tonight. I was wondering whether it IS business as usual for ESG and whether for instance they can still do deals, sell gas or sell down LNGN equity. The answer might be in Clauses 5.5 and 9.6 (c).

Clause 5.5 says ESG has to continue to support the STO offer ... "unless a superior offer is publically recommended by the majority of the ESG board". Then importantly clause 9.6 (c) says the ESG board has to support the STO offer unless "the ESG board acting in good faith determines, after taking advice from its legal and Financial advisers, that the Competing Proposal is a Superior Proposal."

When you look at the definition of Competing Transaction on page 2 it includes any other offer to acquire 10% or more of ESG, or a controlling interest, or ... importantly I reckon, "enter into an agreement to purchase gas from or sell gas to, a member of the ESG group". ESG has been actively marketing GSAs with the potential for a minority sell down in the project and in LNGN, and the clauses above say to me that they can still do such a deal so long as it is considered superior to the STO offer (for ESG shareholders) and the board recommends it.

So potential "competing transactions" would I reckon include the two scenarios that JP Morgan mentioned in their 5 July report (and they must have got these scenarios from ESG only a week or so before the STO offer was announced).. a sale via a GSA into Qld valued at $1.61 for 4mtpa (equivalent in PJ) and supply to and sell-down of LNGN equity valued at $2.21 for the full 4mtpa .. both of which are superior to STO's offer (that wouldn't be hard!!!).

This gives me some hope that ESG could still be looking at deals and that this story has further to run!

H