Thread by @eastmed_NRG

1/ #oott #eastmedgas #riskarb
Before I get started on this thread it’d be great if you would respond to this poll on the impact of the Elliott offer:

2/ The Elliott announcement is a big deal. Consensus is that is a done deal and the window on an activist play is closed. From day 1 I was out here saying that the offer was a low ball offer and if focus was #eastmedgas that would have just lifted that out of

3/ If offer was about US assets then offer makes perfect sense. Step 1: Pay in stock for the #eastmedgas assets, get the US for free (enterprise value). Step 2: flip the #eastmed gas assets to the highest bidder for cash and sit pretty with the US for free.

4/ Even as late as March 4th and agreed to allow each side to shop its #eastmedgas assets implying that the centrality of the deal for was not the #eastmed.

5/ For the shareholders this was a life saver, getting them out of the investment that has gone every way wrong since 2015. Over extended, lack of focus, over leveraged and over matched by regulators and ‘s Tshuva.

6/ logic for selling even at a low offer: 1) #eastmedgas assets are where the value is and selling in pieces would have left with US assets and no value catalyst

7/ 2) had clearly put brakes on in developing Lev and Aphro using the incongruities between Israel, Cyprus and Egypt to buy themselves time. The S4 makes it clear that hiding its real plan from the region was critical.

8/ Once #oil tanked and was offered a JV of #eastmedgas assets, mngmt and Board were too afraid of loss of the value catalyst and reneged. JP Morgan was engaged to run process for them and reached out to 8 other potentials seemingly none of them from near the region.

9/ Seems like all was covered, but the S4 reads like a weak justification for a bad deal. was preferred offer and all else is dressed up to justify it. This has to be what Elliott management sees. Elliott wouldn’t be involved unless there was a win. So what could the win be?

10/ 1) Just involvement could force a higher offer from 2) Aiming for a nuisance fee to just go away or 3) Elliott recognizes the real potential of the #eastmed that is well beyond just Leviathan.

11/ Elliott’s contacts in the region are significant, it has tried the activist game in Israel in the past with a telecom play and understands the game in the region.

12/ Answer must be that Elliott sees value and has already gone to shareholders to test the waters. Elliott is already dealing with other major deals and wouldn't add this one that gets it mixed up in the NRG politics of #eastmed w/out being clear of the value & the end game.

13/ So, the question becomes what value does Elliott see? Where can Elliott extract value that others have failed to? I believe Elliott sees value in consolidation of assets and wants to force into getting better value for the #eastmedgas assets than is offering.
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