been looking at some of the numbers tonight, and the Chinese...

been looking at some of the numbers tonight, and the Chinese interest has me intrigued..

they (broadly) propose to assist with most of the capital cost - the real question is whether by debt or equity

currently Chinese banks are falling behind on their lending, something they must do (lending) as ordered by the planning authority, where now the central government faces the possibility of having to lower interest rates further, in order to induce borrowers to get loans... this could be the status quo for some time given europe's woes

this is not to say that lending abroad will necessarily be increased, as it is domestic investment that is the aim, however, China is as we know, a long term strategy player, and likes to ensure supply into the long term - just go and look at its efforts in Africa..

but nothing is clear on the debt/equity issue except this - MGO is super bloody cheap at the moment - massively so when stacked along side the likes of OZ Minerals, and with our resource upgrade (hopefully) expected to eclipse their resource show...

so, what do you do as a China Man (no offence intended), when you have been partnering with MGO during another developing global finance crisis, and MGO's sp is way way below parity with other huge companies...?... you go for the equity option - as cash (debt) is way too important over the next few years to be giving to anyone else except your own economy and banks, AND you go the equity option that results in a nice little sp spike earner for those holders who want to be in cash also...

if the above is on track then I think the FIRB has no claim to put off a majority Chinese stake proceeding, as the resource isn't on Oz soil, and over 25% of the company is owned by foreigners anyway

so it is totally an option worth pursuing for the Chinese, who if interested, will need to spend some time fixing on a good fat and respectable figure reflective not of the current share price, but of a real earnings potential share price, because it ain't only about capital costs being banked, but more about a takeover in slow motion - slow to begin with... then all of a sudden..

anyhoos, these are just some Sunday night meandering thoughts .. (7pm where I am)

look forward to thoughts from others


good luck