I agree that as a DRX shareholder there would be those cost savings from a takeover of MLM compared to DRX's current situation. The Capex costs of building a jetty and getting shovel ready is prohibitive. Hence the bind DRX currently has, not being shovel ready for another 4-6 years.
Whereas for MLM shareholders it's 2-3 years away to be shovel ready and the figures add up to a 5 bagger plus dividends.
DRX lost the plot with Nob's Point. A basic check of legislation would have shown they had to build in a designated Ports area. (2 years wasted). Another 2 years now wasted to get to todays stage of an EIS being announced on the Ports North Wharf. If those 4 years hadn't been wasted DRX would be lining up with MLM to export at the same time. As it is now, MLM (with their planned 4.5 Million tonnes PA), will be taking a substantial market share from DRX by the time DRX is exporting.
A takeover of MLM would result in the drive, competence and enthusiasm of it board and management being lost and the past history of DRX's management showing it's face. Say goodbye to 2-3 years to shovel ready for MLM.
AND Look at the salary the DRX's CEO is on, $800k PA. Sounds like a lifestyle company rather than an explorer to me.
It's beggars belief why Sibelco is backing this takeover, unless they intend locking up the whole resource for when Mitsubishi's lease runs out in 2038 and then just moving in. I'm sure the Flannery family would want a return on their money before 2038.
I know what I would be doing if I were a DRX shareholder. Change Ship!
DRX Price at posting:
2.0¢ Sentiment: None Disclosure: Not Held
