Yes I couldnt work out why STO was running so much. As STO not...

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VitaminD

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22/07/21

10:20

Post #: 54682754
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Originally posted by Teddyward ↑

I think there is a fly in the ointment that is not being valued in to all this speculation but not sure how to place a value on it. Current bid OSH taking all the pain and limiting upside IMO. IMO OSH assets have a much greater upside ( if well funded and managed) than STO so STO getting absolute bargain as most OSH assets are derisked significantly. OSH just gets teh benefit of a bigge rgroup and able to bring forward and speed up projects slightly as design locked in and realistically there are pretty fixed time lines in regard to getting production operational.

The majority of partbnerships , leases etc etc have a clause that allows the partner to buy at any final bid price OSH was to accept so if ythat is the case then teh combined entity OSH + STO doesn't end up with the assett that is a growth assett but instead ends up with cash.

I hate to say it as it is always a weird structure but if there were massive synergys to be found by a combined company and they wish not to lose assetts they would be better off allocating a cross holding in each other . Matrket doesn't like that but it has some advantages especially to prevent takeover of both of them. It stops the PNG govt changing the playing field and also stops the majors as partners getting last bid easy transaction and hands on the very growth assetts . No transittion costs . Together as a giant tehy can then safely partner and share resources on next projects , pick off BHP assets and make WPL and others pay full price when entering into any other fields etc.

Just thoughts, more than 1 way to skin a cat and I would have to go through a lot of OSH partner agreements to work out just who has rights to buy out what etc etc.

Last thought is China. China desperate to influence PNG so they will be very active in PNG and would love control of assett and will use any means to achhieve influence to get it IMO and I believe all teh last 2 years of limbo on leases had a China taint on it .

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Yes I couldnt work out why STO was running so much. As STO not as good. I guess it was takeover positioning raising the price

OSH Price at posting: $4.14 Sentiment: Buy Disclosure: Held
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