building a cse for a conti play - 4

Summarizing my last 2 posts

Part 2 almost gives a mathematical proof (argued in words) why Conti needs to sell their assets to deeper pocketed players. Ponder over the paragraph talking about NPV to check this out. Please let me know if you can logically shoot this down - it will help my thoughts.

Post 3 illustrates why BEE compliance requirement can be a dampener for some potential bidders (especially foreigners). Foreigners can get around this by setting up BEE compliant Glencore-Rapmaphosa styled consortium who do the bidding. Besides local companies like Glencore-Rapmaphosa consortium and Exxaro who have no such problems should be invited into the bidding.

I do not like a joint venture (not talking of Botswana here although I would like even that to be sold) for reasons mentioned in post 2; cannot see what Conti management can achieve which a deeper pocketed player cannot achieve by themselves. Besides a 50-50 joint venture with Conti with BEE requirement of 26 percent means that Conti has at most a 37 percent interest. This is really spreading your capital too thin; gross margins will not be enough to make this worthwhile.