Which stocks do you think make attractive takeover targets? If I was picking out one we own, it would be Deterra Royalties. The company was spun out of Iluka and owns one unique asset – a mining royalty over BHP’s largest iron ore mine – the MAC (Mining Area C). The mine is going through a significant expansion accelerating it from 60 to 145 million tonnes per annum of production. This is the only mining royalty company that trades on the ASX and is trading at a solid valuation discount to those listed in the US and Canada. We believe this could be viewed as one of the highest-quality royalty streams owned on public markets. We base this on the long life of the asset, safe jurisdiction, the fact the royalty is calculated on revenue (not profit which is much more common) and quality of the counterparty.
DRR Price at posting:
$4.50 Sentiment: Buy Disclosure: Held
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