They can sell nifty or shut it down if they can't turn it around. Then you're left with Renison, which as I have shown above appears to justify at least the current SP. Am I being too simplistic? I assume there are some costs associated with a mine in caretaker mode, but I would have thought it had at least a nil value rather than a negative value.
That's why downside for me is you're left with just Renison, currently valued on a what 6.6x multiple!? Any turnaround at Nifty or even a sale is just a bonus. Also remember they seem to have well advanced plans to expand Renison with the tailings project, which sounds pretty valuable based on the feasibilities.
Am I missing something? The only thing I keep checking (to make sure I've not screwed something up) is that the $8 million per quarter is MLX's 50% share... that is, the actual EBITDA of Renison 100% is $16 million. If I'm wrong there, then I take back everything!
MLX Price at posting:
36.5¢ Sentiment: Buy Disclosure: Held
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