re: sell now or accept I've accepted the AZA offer as I believe...

re: sell now or accept I've accepted the AZA offer as I believe the value of the merged entity is greater for both the long and short term. The reality is that AZA are producing significant profits today, the sp is currently trading at 3 to 4 times 2006 earnings, their 2P reserves will be re-rated upwards in the next few months, their share of BMG production will be in the order 10-13,000 bopd from Q3 this year. Not to mention significant gas production in coming years.

Nexus apparently have good assets in Longtom and Crux, but nothing proven yet. Ian Tchacos and co have done a good job of discrediting themselves during this campaign. Their main argument has focused on the relativities between the AZA and NXS share prices (since the merger was first proposed) and they have raised some rather dubious valuations on their assets since the proposal. Let's remember that the first tranche of the recent capital raising was a 47c when AZA was at $1.30. That's how the market valued both companies then.

Market forces will prevail on Wednesday when the artificial floor under the NXS sp will be removed. Apparently there is no other party (e.g. STO) willing to take a substantial stake in NXS, which in itself helps to balance the perspective. If NXS was worth as much as the recent valuations suggest, the sp should reflect those valuations.

My guess is that AZA will receive acceptances for 20-30% of NXS issued capital, which will leave both companies in a position where they don't leverage the synergies that would exist if AZA was successful with the merger. Pity, but time will tell if they choose to sweeten the offer to those remaining NXS shareholders in the future if the perceived value (of Crux, Longtom etc) warrants it.

I previously held both AZA and NXS. Now I will hold AZA only and am very bullish about the outlook.

Spec