I have been doing some thinking about my postion in IRN.The only...

I have been doing some thinking about my postion in IRN.

The only way for the deal to be rescued is for Stanhill to reduce the takeover acceptance threshold from 90% to 50%.

All Stanhill are interested in is the Tampakan project. IRN current owns 34% (approx) of Tampakan and will increase to 37% due to an arrangement with the 3rd minor stakeholder in the Tampakan project.

Xstrata holds a 20% blocking stake in IRN so the most Stanhill can even hope to acheieve is 80 of IRN%.

If the takeover was unconditional at 50% acceptances and lets say Stanhill mananged to get 75% of the stock then instaed of Stanhill having an interest in 34% of Tampakan it will have a 25.5% indirect interest in Tampakan (ie 75% x 34%). This indirect interest will increase to 27.75% once IRN increases its interest in Tampakan to 37% (ie 37% x 75%) in the near future.

Botton line- Stanhill would have never have owned 100% of Tampakan anyway, only a portion of it. Is it that significant whether its 34% or 25.5%. Then it can 'on sell' to Xstrata at a much higher inflated price once the mine is in production in a few years time.

If Stanhill lets the offer lapse then the shares will range trade between 60c and 80c until Xstrata decides what to do. The downside is 10c from these levels according to the share-chart (yes i know this is a guess!). But a revised offer from either Xstrata or Stanhill (ie through 50% acceptance level) will see this stock jump back up to around $1.30 (or at least over $1.00 id say!!).

Remember in Xstrata's statement on 5.9.2008 it says that Xstrata has no CURRENT intention to make a revised takeover offer for IRN. In 6 months time they will not be able to resist making a revised offer to get 100% control of the Tampakan world class deposit! After Xstrata already owns 62.5% and a further indirect interest through 20% blocking stake in IRN bringing the stake to around 69.3% (ie- 20% x 34%) plus 62.5% = 69.3%! Another 30% is not a big step for Xstrata!

So IRN shareholders- be patient because this game is not over yet! Tampakan is to important an asset to slip through Xstrata's fingers. The upside certianly exceeds the downside in IRN I think.