ASX Today, page-32295

I think the talk of LTR being "sold" is not a correct characterisation and it's also quite premature.

In my opinion there is a tug of war going on with a lot of positioning of players who all see huge potential value in our company. We know that ALB has kind of bragged that they were getting a bargain at $3.00 per share. Hopefully, that dream is in the process of being shattered.

If Hancock Prospecting(HP) is behind some of the significant buying yesterday, all well and good. But even for HP, LTR is a big pill to swallow at around $7bn. I actually do not believe HP is going to launch any full bid. That is because it doesn't make sense that they would buy a swag on market if they want the lot right now. They could instead just get into a tit for tat bidding war with ALB using the scheme of arrangement structure till somebody caves. Buying on market has negatives for a party wanting a full scheme of arrangement takeover, because they cannot vote their own shares. And buying on market also pushes up the price.

I speculated previously in my post of 3 June 2023 that another offer might come with the intention to get a stake big enough to prevent another party taking over LTR but small enough to be less risky given we are not yet in production. A launching pad for a full takeover after production ramp up. That could well be the plan here. If HP gets to even say 12% it would almost certainly be enough to stymie ALB's scheme because not all shares are voted in these proposals due to apathy or whatever. For instance if only 70% of shares are voted then only 17.5% of total shares voting "no" would be enough to make the scheme fail (ie 25% of shares actually voted). So armed with say 12% only, another 5.5% of shares from other dissatisfied shareholders voting "no" will defeat the scheme.

No need to go "all in" if one buys a pretty big stake now and sits on it. With the commissioning period coming up with its attendant risks and one party there with enough shares to likely defeat another's ambitions, the share price could subside (no takeover premium and possible execution risks in ramp up), and make a subsequent bid for ALL shares a lot easier down the track. In the same vein, as time passes the takeover provisions that include price requirements from previous on market acquisitions fall away clearing the way for a new bid for ALL shares then at a possibly more reasonable cost. That is what I think is going on here.

If my theory is correct, then in time we may get to production with a major shareholder sitting alongside TG and management who may well have designs on a takeover and have a board seat. Against that for us LTH's is that we could get to ramp up production and see Spod prices at say USD4000 or more and a price earnings multiple applied to our EBIT that will lift our share price closer to our mental valuations. This is the outcome I am hoping for as I do not want to see a full takeover. ALB want a cheap entry now because they know what future value we will represent. I think they overplayed their hand.

Let's wait and see what is revealed.

Regards

DF