I can only guess it was the shorters rushing to the exit. They...

I can only guess it was the shorters rushing to the exit. They have to close their position and can only close their position at above $1.40 (as Wyloo sits first at $1.40 for all the remaining shares).

The only other idea is that some parties are still hoping for another party or that they could get sufficient stock to avoid compulsory acquisition (i.e. need more than 10%). The value of this is that without 100%, the tax losses sitting in Mincor couldn't be utilised by Andrew Forrest in the rest of his broader businesses, and he may be willing to bump the price to get this. Hedge funds will sometimes play this game - can get a bump of about 5% (good return if you make 5% profit in a month). Not sure I'd go against Twiggy though - he could hold out easily and would lose money to stare down someone who tried to defy him.

The fact that Board fell over means the issues were significant. At the very least, the Board's recommendation to accept should be a fight to get an increase in price - even 5%.

This is from HSF (https://www.herbertsmithfreehills.com/latest-thinking/takeover-defence-recent-trends-themes-and-tactics-21)
The strongest tool in a target board’s arsenal when faced with a hostile takeover bid remains the ability to withhold its recommendation. In 2020, 11 of the 13 bids were unsuccessful until they were recommended by the Board. This highlights the Board’s role as gate-keeper to control. In the other 2 instances, the bidder already had a controlling stake in the target, so they can be discounted. Often the Board can use its recommendation to negotiate for a higher offer price. In six of the 13 instances of hostile bids in 2020, there was a price increase by the bidder to secure the target Board’s recommendation. On average, the price increase was ~11% of the initial bid.

Limited disclosure on arsenic issue - not sure how they get away without disclosing. They're supposed to arm shareholders with information to enable them to make a fully informed decision, and the recommendation is advisory only. Clearly trying to salvage what little is left of their reputation by hiding the extent of the problem which will unlikely ever be revealed.

I correctly foresaw issues around the debt facility - I think this is probably the fundamental issue - if they wanted to defend the would probably have to raise equity to repay debt facility. Credibility lost, they couldn't raise except by giving to AF.


Limited options on ASX for nickel now. OZL by BHP, WSA by IGO and now MCR by Wyloo.