tty the bidding war about to start

Just sit back and wait for the bidding war to start..



Noble Group are now doing the sums. Noble already holds 22% of TTY and holds 43.65% of BWD. Territory Resources also holds 18.69% of BWD ie. 29,974,750 shares worth about $10 million.
The Noble Group have no intention of giving away their stake in TTY (plus the extra stake in BWD via the TTY holding) for a pitance.

Who has bought the 34.3 million TTY shares over the last 2 days?
Obviously the shareholders who sold don't fully understand the situation and don't have the knowledge of how and why the Noble Group became involved.

I'd say that the Noble Group are currently tying up Michael Kiernan's stake of 18,001,500 shares or 6.79%.

Why didn't Exxaro tie up MK's stake earlier?
Are they fools? No, but Michael Kiernan wouldn't accept their price as he's more closely aligned to Richard Elman of the Noble Group.

The offer by Exxaro of 46 cents is a 64% premium on the last trading day prior to the announcement, but it's also an insult to Noble who'd already offered 45 cents for debt for equity and share purchase.
Do you really think that 1 cent will make the Noble Group walk away with their 'tail between their legs'?
I think not.

The buyers of 34.3 million shares over the last 2 days know that this bidding war has just began.

PORTFOLIO POINT: Fast out of the blocks with a premium offer, Exxaro could start a bidding war for Territory.





Territory Resources (TTY). The M&A merry-go-round kicked off early this week following a bid from a South African miner pitched at a massive 64% premium. The target is junior West Australian iron ore miner Territory Resources, and the 46cent a share offer is a significant jump on the miner’s 28cent close from last Friday.



The $123 million deal already has the backing of the board and is conditional on gaining 60% acceptances from shareholders, in the absence of a superior proposal. It’s interesting to note that Exxaro, the miner making the bid, isn’t Chinese but comes from another resource-rich nation like South Africa. It begs the question: are we starting to run out of quality assets that aren’t already spoken for?



It’s a deal that could get very interesting very quickly. Territory ended talks with Hong Kong commodity trader Noble Group on May 10 about a possible takeover, and while we never found out why nothing happened (these things usually fall apart over price) it’s not beyond the realms of possibility that Noble will make a formal bid for Territory now that there’s one on the table to compare it with.



Exxaro has a pre-bid deal on an 11.2% stake with Territory shareholder DCM, and although it’s substantial, it’s not going to be enough to prevent another bidder from swooping and wresting control in a counter-bidding situation. At this stage I think there’s a good chance of Territory becoming the subject of a contested bid and not just because it’s in a highly sought-after sector of the commodities market.