1. Is OZL a take over target?Minmetals was prevented from...

1. Is OZL a take over target?

Minmetals was prevented from acquiring Prominent Hill due to its location within the sensitive Woomera area - so that precedent effectively rules out the Chinese.

As for other acquirers - where is the upside in OZL that justifies paying an acquisition premium? (PH is coming to the end of its mine life, and Carapateena is a high technical risk greenfield project).

Significant proportion of OZL value is now made up of cash and SFR shares - so would you pay a premium to acquire these?

Conclusion is - probably not (but you can never rule this out).

2. Is OZL a horror story
I think you have a fair point in relation to the senior management - how much should they be paid to manage what is effectively a company with one mine and a development project.

As you point out, OZL have failed to build a project pipeline - and as all mining companies are based on a wasting asset base, it is key to replenish this asset base (find, develop or acquire new reserves).

I think you should be worried. In the short term, the stripping ratio at PH will fall, and PH will generate more cash, but 3-5 years out?

As a corporate it is better to have a strategy (OZL = pure copper, >50ktpa Cu pa), but unless you are prepared to adapt your strategy as circumstances change it will not do you much good.

OZL's strategy appears to have failed - so question is how are they going to adapt to changing circumstances.