who dare to buy, page-16

hotdoggie, here's an annotation of te AFR Street Talk article:

http://www.afr.com/p/opinion/merrills_foresees_nexus_liquidation_PDTma6KUQgPbienyJvQsdP

It says Cottee had lured big investors since he came to NXS in April, 2010, due to his deal-making capacity, but cracks appeared after NXS failed to find a partner for its $1.4b Crux project, and te company hasd had to juggle mounting liabilities, including the fresh lawuit from Sedco Forex over a failed rig contract in 2009.

Merrill Lynch has had an underperform rating on NXS for nearly a year, and they argue that "Cottee's departure could result in te company being liquidated".

The broker is tallying a $140m liability split between the $67m Sedco suit, a $60m letter of credit held by Santos over its obligation to supply gas and pay tariffs at Longtom, and a $14.6m cost increase of the subordinated note if forced to break up the company.

Others in the market worry about the reintroduction of the founding Director of NXS, Michael Fowler, into an executive role. Fowler is still remembered as one of the team who loaded up NXS with too much debt in te GFC, wich led to a failed attempt to sell off its prime assets.

Cottee was lauded for saving NXS from near bankruptcy wit debt refinancings and new capital.

A costly arrangement with Royal Dutch Shell givces NXs a crucial 3-year extension to te date when it hands over rights to the lucrative liquids in the field. However, that agreement will collapse unless a financial decision is made at the end of 2011. That appears "increasingly unlikely" and has led to speculation that a corporate bid may be on the cards.

Shell is hardly a stranger to M&A in Australia, and appears the most likely suitor, given its need for certainty over Crux gas feed into its $US13b Prelude floating liquified natural gas venture.
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Now back to my own terrible performing shares. :(

Good luck NXS holders.