To The Moon

$AGL ENERGY LTD(AGL.AU)$

Spent whole day ytd researching and deciding if I should continue with AGL.

Went to research on background of activist 

Investor, Mike Cannon Brookes.

https://en.m.wikipedia.org/wiki/Mike_Cannon-Brookes

Seems like a sincere guy.

However, that doesn't prove anything.

Went to study more on the way forward for AGL, together with the understanding of what Mike CAnnon Brookes will want to do.

There was an event between him and Elon musk's $Tesla Motors(TSLA)$

https://amp.smh.com.au/business/mike-cannonbrookes-concedes-battery-bet-with-elon-musk-20171124-gzsj25.html

It shows that he is indeEd capable and he will walk the talk.

I studied also on his previous 2 takeover offers which was rejected by AGl board.

it was reflected then that only a privatised AGL will be able to move swiftly towards decarbonisation.

With this, I have an inkling of what May happen once the new board is formed.

1. AGL will have to pump money and build up renewable energy sources by 2028-2029 in order to allow for coal power plant to shutdown by 2030.

Without an alternative supply up, Aussie Govt will not allow early termination of coal power plants as that will push up electricity prices.

2. Where does the money come from?

After cancelling the demerger, some funds are freed up. However, if these funds are sufficient, why doesn't agl management implement renewable energy earlier?

I suspect the costs isn't a small sum. Capitalwill need to be raised, which shareholders won't be happy with.

There are several ways:

A. bank loans (with raising interest rates, it's a bad idea)

B. Share dilution (share holders won't be happy)

D. Sell bonds (take up more debt)

E. Cut dividends (share holders won't be happy)

F. External cash injection from 3rd party...

(will anyone inject cash for free?)

3. When everyone is being preached on doing gd to the environment, but others are doing and they are not affected. There will be a lot of cheerleaders.

When their own money is being involved, I wonder how many will continue cheering or will they start jeering?

4. With unhappiness building up, the likely way to go forward will still be privatisation.

That is the likely way to move rapidly and dowhatever is needed to push for green energy.

If that's the case, there won't be incentive topush up share prices. In fact, for privatisation to take place, the lower the share price it is, the better it is. Just look at twitter and Elon musk.

Of course I may well be wrong, and the new board and leadership could be looking after share holder interests.

But well, one of my investing principles is that I have to trust the management. 

I have done my deliberating. I cannot bring myself to trust that the new leadership will look after my interests as a share holder.

Hence, I sold off all my agl shares.

it's a personal Decision, for all we know, maybe agl management will offer 15-20% premium over current share prices to privatise and I will lose out on the potential gains. 

However, I will prefer to follow according to my own investing principles. 

With the freed up capital, I opened positionsin $Maca Ltd(MLD.AU)$$BANK OF QUEENSLAND LIMITED.(BOQ.AU)$and DCA $Regis Resources Ltd(RRL.AU)$

BOQ is one of Aussie bigger banks, and cantake advantage of raising interest rates.

Maca is a miner as well as infrastructure contractor. Can ride on raising commodity prices.

Regis resources is a gold miner. Planning to use Regis to hedge raising commodity prices as well as to insulate in the event of market crash. 

i felt so much better after taking concrete action after the agl messy demerger outcome. 

Just my 2 cents worth Regarding my plan for 1/6. 

Invest safe everyone.

[Cool] 

@TigerStars