Daily Brief Australia: Austal Ltd, Sigma Healthcare, ADX Energy Ltd, SenSen Networks and more

• On 2 April, Austal Ltd (ASB AU) rejected a non-binding proposal from Hanwha Ocean (042660 KS) at A$2.825 due to concerns about obtaining Australian and US regulatory approvals. 
• The Board’s claims are on shaky grounds. On 1 May, the AFR reported that Australian Defence Minister Richard Marles had no concerns with Hanwha’s privatisation bid. 
• The Board’s rejection is a clumsy attempt to negotiate better terms, such as a bump, ticking fees, or significant break fees. At the last close, the gross spread was 21.8%. 

• Seven Group Holdings (SVW AU) now holds 85.8% of Boral Ltd (BLD AU) and that will lead to deletion of Boral from the S&P/ASX 200 (AS51 INDEX). 
• As expected, Sigma Healthcare (SIG AU) will be added to the S&P/ASX 200 (AS51 INDEX) at the close on 9 May.
• Sigma Healthcare (SIG AU) price movements will be largely influenced by its pending merger with Chemist Warehouse Group (CWG).

• ADX has raised A$13.5 mm of new equity priced at A$0.105 per share.
• One free-attaching option will be issued for evert two placement shares with an exercise price of A$0.15 per share and an expiry date of 08/05/2026.
• The proceeds from the raise will fund (1) the production testing of the 450 m gas column encountered at the Welchau exploration well (the well might also be deepened to assess the exploration potential below the current total depth of the well), (2) the residual drilling cost (net of the carry provided by MND) of a gas exploration well on the ADX-AT-I licence, (3) the residual cost (net of the carry provided by MND) of the drilling and tie-in the Anshof-2A sidetrack and (4) upgrades to the gas processing facilities at ADX’s Vienna Basin fields.

SenSen’s Q324 results reflect the move to a lower cost base that provides a platform for future profitability. Minor delays to the National Heavy Vehicle Regulator (NHVR) contract affected Q3 but should not affect FY24 as most of the deployment is now complete. North American Smart Cities growth is gaining traction via partnerships, underpinning Q424 momentum alongside strong fuel theft solution uptake. Restructuring to drive a return to sustainable free cash flow is mostly complete but resulted in one-off costs. We revise down our FY24 forecasts assuming similar Q4 growth from a lower Q3 base.