The reaction to contrasting news on private equity buyouts has been illuminating and says a lot about the overcharged state of the Australian share market at the moment.

Chemicals and explosives group, Orica rejects a $9.88 billion, $32-a-share offer from a group of private equity operators and the shares explode, rising more than $5 in the space of a few minutes to trade over $33.

On the face of it, it’s hard to see what private equity could have done to boost the returns of Orica, except load it up with more debt.

Orica does have a problem with the disposal of thousands of tonnes of highly toxic chemicals from its Botany site in Sydney. You can bet the private equity sharks would have tried to load that cost onto someone else, say the taxpayers of NSW or residents of Sydney in some sweetheart deal with a complaisant state government.

Regional Pay TV operator Austar reveals solid first quarter figures and a possible large-capital management program that could include a $300 million buyback but no mention of “third-party talks” and the shares slip back to around $1.75c.

No reference to the statement on 4 April that: “AUSTAR confirms that it has received confidential approaches from third parties regarding possible transactions, however, discussions are preliminary, incomplete and highly conditional.”

That buyback is only a suggestion at this stage and obviously things are still “preliminary, incomplete and highly conditional”. Foxtel is the best tip to move on Austar.