I dont think they would get it done at that price. Renison will produce roughly 10,000 tonnes a year at a cost of about 9,000 per tonne. At current prices, you're looking at profit of $150m, or about 7.5c a share. That is just Renison, you also have some small royalties to add to this. So with EPS of say 8c, a takeover bid of 80c is on a multiple of 10x earnings.
If that was all there was to MLX, then maybe it would get done at 80c, but that is about 1/5th of the companies assets. Wingellina is the 16th largest known nickel deposit in the world. Provided it is feasilbe to mine, your looking at 40,000 tonnes of nickel per year. That is additional revenues of over $1b (using $25k per tonne as the price). A bid of 80c values the company at less than $1b - I dont see that happening.
Plus you have a 19% stake in West Gold, which right now isnt worth much but is still an asset.
I cant put a value on Wingellina because we dont know a) whether it is feasible yet and b) what the costs will be, but I do believe a bid of 80c ($960m) wouldnt even be put to shareholders.
As nice as a takeover bid would be, I think MLX is in a position to deliver huge returns to shareholders anyway over the next 6 months and beyond. Once Renison kicks off and (hopefully) a positive feasibility study is completed at Wingellina, the share price will take care of itself.
MLX Price at posting:
0.0¢ Sentiment: LT Buy Disclosure: Held
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