Why are we thinking that a Strategic buyer (as opposed to a ultility company) will pay more?
The simple answer is that Jeff said so.
He never mentioned a German Strategic to me or in public as far as I know, but I have not spoken with him lately, so the German connection could be a new development. Jeff did say that US and foreign/European Strategics were among the 6 new entities starting Due Diligence late.
And what is the rationale behind the assumption (Not a fact until it happens) that a Strategic will pay more than a normal power producer?
That too is related to what Jeff said in private and public. I believe he mentions that Strategics would pay a price based upon getting a 9% return...and that this would mean more money for shareholders.
My calculations (using my own assumptions) indicate that Jeff has reason to say that. If he is right and one of these Strategics bids on this basis, we will get a lot more than his $3 minimum.