Gramps

Chalice:

One of the interesting bits to come out of HP’s bidder’s statement was that at the end of FY2022, it had cash and cash equivalents of $17.7 billion.

So Ms Rinehart could buy just anything she so desires.

As it is, she told the Financial Review’s intrepid Brad Thompson during the week that HP would continue to seek out Tier 1 assets, with the preference to “have the vast majority of our investment in Australia”.

“Investment in Australia is what enables our high living standards. However, we must be mindful of government policies that make investment and development unattractive,” Ms Rinehart said.

Fair enough, and interesting given HP was sheeted home this week home as a buyer of a $60m-plus block trade in Chalice (CHN), owner of the Tier 1 Julimar nickel-copper-PGE deposit on Perth’s doorstep.

A $60m purchase of stock in a $2.4 billion company (which has flagged it would consider a strategic partner taking up a minority strategic position in Julimar’s development) is not a big deal in itself.

But if the buyer goes on buying, things will get interesting very quickly. And it goes without saying that if there was more buying by HP, the group’s $17 billion or so firepower makes Chalice at its current market cap look like a bit of a snack.

But there would be plenty of competition. Discoveries on the scale of Julimar are rare and the thing is made for the metals-intensive energy transition. Interestingly, another iron ore magnate, Andrew Forrest, was reported late last year to be bidding Tim Goyder for his stake in Chalice.

In addition to the block trade, chatter in broking circles suggests someone has accumulated a large derivative holding in Chalice.

The talk has further fuelled rumours that Chalice could become the subject of a shoot-out between HP and Forrest, with BHP also being cited as a possible interloper.