ext looming t/o - nearest to the pin, page-19

worth the read POST # 7474895 from PDN tread





"""""""""""""The following shows the 4 key deals that have been announced since Fukushima, on an EV/Resource (US$/lb) basis:
• RIO/Hathor $10.74/lb
• CGNPC/KAH $4.45/lb
• Hanlong/BMN $0.88/lb
• ARMZ/MRU $9.19/lb

At first sight, there doesn’t seem to be much consistency across this sample set. This is mainly due to the vastly different capex requirements of each project. For example, KAH/EXT's Husab project requires a huge US$1.7bn of capex vs Hathor at US$458m, BMN at US$562m and MRU at US$298m. Therefore, it is important to add the capex requirement to the EV to ensure the multiple takes into consideration the future financing requirement. When I do this, there is more consistency as shown in the following chart:


As you can see, the MRU and KAH deals are being struck around US$12/lb, when I adjust for capex. """""""""""""""""