bhp billiton preparing hostile bid for rio , page-6

IMHO Rio will not sell to BHP ever.

BHP are too soft and why would shareholders sell out on a market trending down. One's listed at 30 odd and the other at 100 plus odd and who are the major shareholders who will be voting.....? Rio have the killer instinct and so do the board in London and always have.

BHP are in for one hellva fight if they think Rio will turnover. Yes Rio might like to dispose of some companies that aren't performing well to any mugs willing to buy at a premium but that's it - like Rio said in statement over weekend. Only interesting statement however that didn't fit with my opinion was Albanese saying next time he was back in Pilbara would be to see self-automated machines working - well BHP have patent on self automated dump truck and others done back in 1990's with a well known euro manufacturer that they may still be working on - maybe there was more to Albanese statement?

But I think far more likely Xstrata will also make a bid for Rio they like market downturn buying opps and are well cashed up so why sell cheaply when you're so sought after.

Synergies - yes and no there's more to running a global miner than selling iron ore and commodities these are huge conglomerates the management let alone administration to make the changes will be enormous and cost heaps - at this stage given worst downturn today in 25 yrs on asx believe both will continue their own paths for some time to come and weekly prices may go up and down and up.

IMHO Rio will reach near $ 200 before they even consider any buyouts from a bidder. Good luck to BHP because the cost of due diligence is in the millions and climbing.

Both have excellent fundamentals but iron ore is only rising and so is demand so why sellout when you don't have to unless you know something fundamental about Rio cashflows that I dont? Similarly BHP don't need to spend more fact finding deficit $ they are an excellent company but it does look like power control move for them which is never a good choice in pending bear or severe correction market unless there is something else in the wind?

Cheers

Winning Trades

Nothing here is ever advice. The market is always right and is your best teacher.