I would be way over my head attempting to answer the question you have posed. In a $2.5 billion transaction involving foreign currencies, reserves, guarantees, etc., only the accountants will know for sure how all this comes out in the end. All I know is that there is a press release out of Sidney stating that the New Horizon shares have been halted from further trading pending anticipated news on the deal closing. According to the press release, the "owners" will be getting about $155 million for their equity position. Assuming that CMS owns 49.5% of the equity, that would suggest that CMS will be getting something for its equity. How much after currency adjustments, adjustment of reserves, tax adjustments, etc. CMS will receive is really impossible to predict. If you have more information on the sale please share it. In any event, I view the closing, if it takes place, as another positive for the company.
Legal, I agree that trying to guess the outcome of the Loy Yang sale would be pure speculation. Unfortunately, that's just one of many bad investments where the outcome is unknown.
Seems to me that investors are entitled to know the facts about all the investments that have been made. And I mean some straight talk that investors can understand. While the information in the SEC filings is informative, it is often unclear and doesn't, in my opinion, tell the full story.
I've included a small section of the 3rd quarter SEC form 10-Q below.
"As of September 30, 2003, the cumulative Foreign Currency Translation decreased stockholders' equity by $419 million. Included in this amount is an unrealized loss of $118 million related to CMS Energy's investment in Loy Yang. This loss, and the impact of certain deferred taxes associated with the Loy Yang investment will be realized upon sale, full liquidation, or other disposition of CMS Energy's investment in Loy Yang, for a total loss of approximately $168 million. In July 2003, a conditional share sale agreement for CMS Energy's investment in Loy Yang was executed. See Outlook, "Corporate Outlook" section in this MD&A for further discussion."