Ann: Cancel - Proposed issue of securities - MNB, page-8

For sure Talus will want a profit. They will likely be getting a steady, infrastructure style return on investment. So a lower rate of return.
That's ok because their pre-designed modular plants are much cheaper than a large one off designed plant that needs to go through the design, engineering and costing process as well as a lengthy financing process. It's very likely much more expensive to design and build a single uniquely designed and engineered plant than mass produced, already designed modular plants. There are also almost always cost blowouts when it takes extra years to go through the design, costing and financing stages. So the overall capex will probably be hundreds of millions cheaper using the modular plants and there is the added bonus of being able to start smaller and scale up for more upfront capex savings.
Minbos will still have (a greatly reduced) capex in the downstream plant to turn ammonia into the finished ammoniate nitrate range of fertiliser and explosives which will be value added products for Minbos.
With only some fraction of the cost of the originally planned plant's total upfront capex, there still could be a higher return on investment for Minbos, with less upfront capex to repay, less interest to pay, less depreciation and less sustaining capex. Let's not forget, having to fully fund the original design at around $US450-500mill would likely have needed a lot more dilution if the lenders would have required say 50:50 equity to debt. Even a much more favourable ratio would still have been heavily dilutive depending on MNB's market cap at the time. The level of dilution will be much lower with the Talus BOO model and if you combine the much lower share dilution with the reduced combined upfront capex and other savings listed above, then even with Talus taking some of the total profit, Minbos shareholders still might see a similar earnings per share either way.
For example and hypothetically if there were two billion MNB shares on issue (and that would be generous under the original design capex), that ammonia project delivering say $200mill profit a year would deliver 10c per share earnings to Minbos shareholders as opposed to 20cps if there was zero dilition and a billion shares on issue. If the modular system was built up to the equivalent capacity and delivered a similar total profit which Talus perhaps took a 30% share of, that would leave 70% of the profit for Minbos shareholders. Under the BOO scenario, there would be much less Mnb shares issued for capex so that 70% of profit might still work out to a higher earnings per share for Minbos shareholders compared to going it alone and keeping 100% of profit.
In fact with the modular plant at the same scale as the build your own plant, annual profits might be higher with the cost savings listed above.
Let's also consider how difficult it would have been for Minbos to raise US$450-500mill if going it alone. If they went with a 50:50 JV, they still would have then shared 50% of the profit.
This Talus arrangement sounds to me like it might be the best outcome for Mnb shareholders financially and it is almost certainly going to be far quicker to production given the scalability for a much lower start up cost and pre-designed and costed modular units.