I do not believe BHP will make a takeover offer.
I believe they will look to take a significant, or controlling stake. One can argue that 19.9% is a controlling stake because 19.9% could effectively block a takeover play by others.
BHP would not look to make a straight takeover at this early stage. The stragtegy with these sort of "plays" is that a major like BHP lets UMC retain the development risk in case there are some "unknowns" in the deposit.
BHP are likely to be happy to pay more at a later date to mop up a company like UMC, rather than risk going all in, now.
Now- UMCers may not like reading that, but reality is, this is what big companies do when they stalk prey...they take a position on the register, minimise their exposure to development risk, and come back later when downside is a bit clearer (eliminated).
That's my 2 c worth, for people to consider: BHP (or whover) takes a controlling stake sufficent to block others, and then come back down the track if all goes to plan.
ANyway - just food for thought.
Bottom line: it's still good news, just another brick in the wall. The fact BHP/RIO et all are looking at UMC adds mainstream credibility to the stock...remember, we here on Hot Copper know the stock backwards...the broader investment community know stuff-all about what we take for granted, here.
Good luck to all holders.
Coop
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