Bodo and LZA, I appreciate your views and results will likely support your position. But do consider the following:
1. ENV cap gains roll over to APA shares, so no tax paid unless you take cash. See section 10 of the booklet. Exceptions might exist ( non Australian holders?).
2. Neither of you mentioned the new regulatory rules for ENV,s next reset. Consensus views are that past increases may be less generous in future, but not yet clear. This new reg calculation is a key reason why most APA analysts thumb down APA's bid for ENV.
3. The Chans represent a fund with a mandate to invest in regulated assets. They might oppose the TO mainly because their fund's mandate *might* require them to dispose or avoid buying APA shares, which are only about 25% regulated. I don't know their cgt obligations to Oz gov't but likely none in home country (HK or MY).
4. Analyst consensus predicts better returns for APA than ENV through the next few years, partly due to regulatory reset concerns (see above) and partly due to growth in nonreg segment (LNG export, etc). Broker research can be wrong, but less so in collective results.
5. ENV assets are managed by APA. ENV's board sets strategy, but APA is also on the board. Arguments that ENV manages better than APA doesn't fit these facts.
Please understand that I would not own ENV shares if they were a bad investment. And their past performance has been good. But logic and facts indicate (never with certainty) that APA is the better horse over the next few years.
Just my opinions and found facts. Please DYOR.
ENV Price at posting:
$1.15 Sentiment: None Disclosure: Held
