To The Moon

Hello fellow 🐯🐯🐯 this is an update on $ORIGIN ENERGY LIMITED(ORG.AU)$ takeover offer. For those who didn’t manage to grab the 20%-30% profit opportunity💵💵💵 in Jan when I last posted about it, there’s still time⏰ For A More Than 10% Profit💵❣️

Yesterday (22/2), the consortium made up of Brookfield Asset Management & affiliates, along with Mid Ocean Energy submitted a revised proposal, still conditional at this stage, to acquire ORG’s shares for $8.90 a share, paring off $0.10 off the last Nov’s offer of $9 (& back to their Sep’s offer price).

❗️Under the revised offer, the consortium would pay a price of $8.90 a share for the 1st 100,000 shares in ORG. For shares above that level, it would pay $4.334 a share plus $US3.194 ($4.66) per share for shares above that level.

🥳🥳 All parties today reaffirmed their desire to continue progressing talks about a binding deal.

👍 Brookfield, which is seeking to acquire ORG’s domestic energy generation & retail business to accelerate its shift to renewables, today said it believed the company would play a lead role in helping the nation meet its climate targets, & looked forward to progressing to a signed scheme-implementation deed.

👍 ORG’s board today said it believed the revised proposal still had the potential to deliver significant value to shareholders, & “accordingly, intends to continue to progress discussions with the consortium, including the negotiation of a scheme-implementation deed”.

🤔💭My Thoughts:

⭐️ As per my suspicion, the bidders for ORG are very keen to close a deal although they’re trying their luck to lower their cost for the takeover. The bidders’ repeated offers make the risk of this takeover failing lower which is 👍 when investing in buy-out offers.

⭐️⭐️ I’m not too worried about the lower offer price as it’s just a 10c difference😅 & analysts’ review of ORG remain positive in Feb.

✅ 8 analysts rates ORG with an average target🎯 price of $7.93 with 2 Buy Ratings, 2 Outperform Ratings, 3 Hold Ratings, & 1 Underperform Rating.

➡️ ORG is still a somewhat safe buy as it’s currently trading near it’s average target🎯 price after surging more than 10% on the re-negotiated takeover deal.

⭐️⭐️⭐️ ORG has a high price🎯 of $9 & a pretty decent dividend history, so if the takeover fails, I'll just happily collect my dividends until its share price goes up to $8+ to sell it for a small profit😉 ORG recently declared a 16.5 cents/share fully franked interim dividend payable on 24/3/23 with a Ex-Dividend Date 28/2/23, which is a reasonable 4%+ dividend yield. For 🇸🇬 residents, there’s no Witholding Tax as this is a fully franked dividend so you get to pocket the full dividend🥳🥳🥳

❣️❣️❣️ For more details about ORG & its dividend yield history, click on the stock code➡️$ORIGIN ENERGY LIMITED(ORG.AU)$ then go to "New Posts", & you’ll be able to access my last 2 posts on ORG.

🔎Quick Background On Origin:

ORG is an integrated energy company. The Company is an energy retailer in Australia across electricity, gas, & LPG. On 10/11/22, ORG announced that a consortium made up of Brookfield Asset Management & affiliates, along with Mid Ocean Energy(an LNG company formed by EIG Partners) had approached ORG for a takeover bid at $9 per share, a 55% premium to its previous price of $5.8.

➡️ This bid received unanimous support from the company’s board. Previous offers by the consortium of $7.95 cash per share in Aug & $8.70 to $8.90 per share in Sep were rejected.

➡️ Initially, the exclusivity period for due diligence was set to expire on 16 Jan but an additional week until 24 Jan was granted for the North American consortium. Shares in Origin Energy slid as investors were quick to speculate on the update.

➡️ The consortium’s due diligence has lasted more than 3 months & its exclusivity period has expired, however Origin chief executive Frank Calabria affirmed that the company remained in “active engagement” with the consortium about the prospect of a binding takeover proposal.

➡️ On 22/2, the consortium submitted a conditional revised proposal, to acquire ORG’s shares for $8.90 a share.

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