interesting, page-5

big us fund buying + article Australia's ConsMin says U.S. fund eyeing stake
Thu Mar 9, 2006 12:35 AM ET
SYDNEY, March 9 (Reuters) - Outback Australia miner Consolidated Minerals Ltd. (CSM.AX: Quote, Profile, Research) said North America-based investor Wasatch Funds planned to take a stake in the company, whose shares have dropped more than 20 percent this year in tandem with the price of its main product, manganese.

Manganese, as well as ConsMin's other products, chromite and nickel, are minerals used by steel-makers for their toughening qualities.

Australia's ConsMin says U.S. fund eyeing stake

"I received an e-mail the other night from a big American fund that said it was prepared to take a substantial stake in ConsMin," Managing Director Michael Kiernan told a briefing for media and analysts on Thursday.

Kiernan told Reuters he had been contacted by Wasatch, a funds manager specialising in small and mid size companies, but said he did not know what size stake Wasatch intended to buy.

In London, where ConsMin (CNM.L: Quote, Profile, Research) is listed on the Alternative Investment Market (AIM), volume on Wednesday was an active 8.5 million shares, more than 30 times its daily average over the last year of 275,000 shares.

London trade was dominated by 11 block trades, totalling 8.4 million shares, at a price of 98 pence each. That number of shares equates to a stake of about 4 percent in ConsMin.

Under Australian law, if any one shareholder owns more than 5 percent of a company's stock it must lodge a substantial shareholder notice with the Australian Stock Exchange.

ConsMin on Monday reported net profit for the six months to Dec. 31 of A$7.4 million ($5.4 million), down from A$22 million a year ago, but said it expected a much better second half thanks to steps in China to curb exports of steel-alloying metal. ConsMin shares ended 1.3 percent higher at A$2.39 in a firmer overall market on Thursday, giving ConsMin a market value of about A$520 million ($380 million). However, the shares are down about 23 percent so far in 2006, while the benchmark S&P/ASX 200 index <.AXJO> his risen nearly 3 percent.

Manganese prices have slid as the world stockpile of manganese alloy had swollen to 900,000 tonnes from a more typical 150,000 to 200,000 tonnes, while high-grade ore inventories, from which the alloy is derived, increased by 1 million tonnes to 1.8 million tonnes. A industry benchmark price of $3.00 per metric dry tonne unit, set by industry heavyweight BHP Billiton Ltd./Plc. (BHP.AX: Quote, Profile, Research)(BLT.L: Quote, Profile, Research) for annual deliveries of ore starting April 1, is 25 percent below the last negotiated price. ($1=A$1.37)