Running Commentary on the SP Movements., page-6104

charles:

u need to think like a buyer or a vendor & ask yrself the following : Do I pay top dollar later or buy it while its cheap, how much resource/reserves r known & can b extracted, what's the mine life, costs, logistics, risks etc etc ?? All this is part of due-diligence process for an M&A.

Does the buyer have prior mining experience or are they just keen for the end product, which means they can sub-contract the Mining Ops to a third party etc etc. (eg: in Oz we get Thiess or other Subcontractors doing this sort of work on numerous Mining or LNG projects).

Essentially u need certified tonnage to attract premium. Till then the interested party can take up a majority/ blocking stake by the issue of shares or buying stock on Mkt and wait, if they really want the end-product.

Example of this soap opera was Tianqi's acq. of Talison in Dec 2013.

They had 5% in Talison via Windfield and once Rockwood made an offer of C$724 mil, they started buying stock & built up 19.99% before making a counter-offer for C$848 mil or AUD815mil.

In reality they paid C$689mil for the remaining 80% of Talison. This included acquiring 36.2% from a major shareholder RCF Funds.

Also back in Dec 2013 AUD was almost on parity with the USD and the 5 year revenue projection by Ernst & Young for Li sales ranged between USD350-450/ton !!! So Tianqi got Greenbushes pretty cheap. Classic textbook hustle by the Chinese b4 they sold 49% back to Rockwood (now part of Albemarle).

Back to AVZ, so far there's been no 'change of substantial holding or becoming a subst holder lodged by the company, so must b a game of hide & seek going on, given the rumours on HC.

In summary, as far as a T/O is concerned, AVZ needs runs (tons) on the board. Dont know if they'll b declaring the innings before any Runs were scored, especially when the pitch looks to b batsman paradise (simple cricket analogy for the Manono deposit).
cheers.