This is going to be a very interesting couple of months. Macquarie Capital will bring home a large prize, in my view. They obviously know all the players who looked at the Wodgina deal, and there will be others. Equity in this sensational asset will be highly sought after.
Wodgina and Pilgangoora are slightly different but not so much that we would expect vastly different monetisation.
Wodgina is 25kms closer to Port Hedland and can get direct gas connection to NW Shelf, however, it is a 120m deep open pit which requires money to be spent on the cut-back. Also, they still have to prove they can produce a high quality spod concentrate.
PLS, of course, has mine in full production on its way to Stage 2 at 5mtpa+.
I think we will see $1bUS at least for 49%, if that ends up being the %.
Remember this is not a sell down of the company; just the Pilgangoora asset.
This de-risks the company yet again. Nothing guaranteed in this world, but surely we will see $1.50 + following the deal being consummated.
PLS Price at posting:
75.8¢ Sentiment: Buy Disclosure: Held
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