Ann: Binding Transaction Implementation Deed with SQM, page-518

@Lourdes
re the article in livewire markets ‘how to screw a promising industry’
Post #:70586887

The writer Kingsley Jones from Jevons Global seems to be banging on about political interference in the market in the form of potential blocking by the FIRB, which he insinuates, could have become politicised on the basis of policy comments by Resources Minister Madeline King.

King has apparently stated that 'likeminded' foreign investors would be welcome to invest in Australian critical minerals projects.

He seems to forget that the FIRB might change policy settings depending on the government in power. More importantly, it was the former Treasurer Peter Costello who personally intervened so that the attempted takeover of Woodside Petroleum by Shell was blocked 'in the national interest'.

That's a Ministerial discretion and it's important to note that while the FIRB has waved through takeovers before relating to SQM, the Ministerial discretion can be used to override its recommendations, and that that just requires the decision by the Minister to be reasonably made "in the national interest". (I haven't checked the legislation just going by my understanding from the previous decision by Costello and the standard form this usually takes about having taken into account relevant considerations).

What constitutes 'the national interest' may vary from time to time, but Jones notes that China is variously buying 50-90% of the market for critical minerals.
He is saying that Gina Rinehart has bought up a deal with a view to it becoming even cheaper down the track, if the FIRB rejects SQM's deal.
He says that global capital will be scared-off and this will make purchasing even cheaper for Gina.
I think in his enthusiasm for globalism, he's missing a few points.

1. China is seen as a threat to the US and we are strategically linked to the US. There is the possibility that the US has leaned on Australia to sort out better supply chains to allow the US industry to compete with China and become more self sufficient. This is seen as a strategic interest.

   
   

2. There is nothing to stop the SP from rising on the back of outstanding drill results given there are likely to be interested parties given the high quality of the Li pegmatites.

   
   

3. There is nothing to stop pegmatite-sourced Li-battery material prices going nuts into the future (as compared with just the Li market as vaguely and inaccurately described since it is a chemical product that is the material, see the Mr Lithium's exposition of this in the Money of Mine Youtube content. Apples and oranges situation.

   
   

4. Gina at 18% has stopped safely shy of the 19% trigger, keeping her options open and raising the stakes. She may not believe in climate change but she believes in money and is attracted by AZS.

   
   

I can't account for the tweet/post in X from Alex Rovira essentially telling Gina to eff off! My guess is trying to preserve the deal by discouraging sellers who were pretty much selling to Gina over the past few days. (18% reached...that didn't go well... ).

It's an extraordinary situation, but we need to think about what made the former Treasurer Costello decide to block the FIRB decision, think about broader implications of government policy and what if any role that Chris Ellison from MinRes might have since Jones seems to think he's a player.

Ellison wound up being no fan of Albermarle which is US-based and has deals with the Chinese (which Jones seems to think is definitive of the logic of international markets and by which if you sell the farm for chump change, no problem).
But it's interesting also that as Mr Lithium noted in a long YT interview on Money of Mine, (paraphrasing) they don't actually know jack about operating a Li mine and haven't done so since the late 1980s. Harsh, but probably true! In which case why not flush them out of the scene if they're lead in the saddle.

Jones was putting a lot of weight in the ubiquity of Albemarle's and SQM's Chinese connections, and that supposedly makes it all AOK but not sure if that will fly with King... nor more importantly if it actually IS in the national interest, a possibility that Jones doesn't seem to be capable of contemplating.
Governments set policy and there are cogent national security and defence matters to consider.
Regardless I'm not sure I want Gina to run AZS not least of all because she would have a cash offer as well being unlisted, but Ellison would have a clue. I'm not selling for now, this is way too exciting to go all safe...