AGO 0.00% 4.5¢ atlas iron limited

Yep. The DTA and consolidated equity of the acquiring company...

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    Yep. The DTA and consolidated equity of the acquiring company Ive gone through in the impairments thread many times already but the other extremely important point is that whether the acquiring company is FMG or Redstone, there are potentially up to $1B of other impairments that could be written back.

    Much of the impairments relate to Horizon 2 assets which are in the Sth West Pilbara. Given the fairly close proximity to both railway lines at Roy Hill and Christmas Creek, many of those stranded deposits would be economic in nature even if they remain undeveloped until the winning bidder seems it the right time to develop.

    The other issue I have with accounting standards is that onerous contracts are shown in the accounts as a provision (ie rental leases). There is a provision at the moment as they are out of pocket for excess office space they are trying to sublet but the assumption is it will remain that way until 2022. However, the DSO contract does not appear as a future benefit.
    Therefore there's $20m minimum in profit coming our way.
    There's also gross royalties of $180m from AJM (I've calculated this in another thread). The discounted value would be less but it would still be about 1.5c value
    Then there's Mt Francisco and Pancho

    Ridley was turned down for $230m for 70% 8 years back when 68% grades were not in vogue. Premiums now for 68%+ are USD 50 more than standard fines.

    Also FMG for example would need to consider what would happen if x amount of additional tonnes per year hit the market. How much would the fe price drop by/their profit be affected by? Even if $1 per tonne, it could mean $170m per year in lost profit by waiving their right to acquire ago.

    There's still conjecture around Utah point. In summary having read through the 2016 Utah sale bill today, treasury were still of the belief 6mt per year were for majors. Also the sale pre the bill passing could still be made from a junior to a major. Although the bill was passed, it was rescinded in 2017....

    Of course NWI still hasn't been resolved as yet.

    Good work all. We are finally getting some action at the poker table. Looks like we are the house and more often than not, the house wins!

    Cheers
 
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