Bidding for Felix Resources is going to be a very tricky business for any company. 71% of the stock held by major shareholders, who are all showing very hefty gains and a cash bid would mean heavy capital gains tax bills. Many of the shareholders are also contractors within the company, with all of the companies producing mines.
Any bid would therefore need to be in all stock or stock and cash. Xstrata were favourites, but lost out badly to AMCI, and are locked in a legal appeal over their 20% land ownership that covers Felix's 80% owned Moolarben Project.
We can see, with the Felix price over $12, that a take-out-bid is going to have to be decisive and with the agreement of all the major shareholders.
Would any major be willing to bid over $15, that's the question?
FLX Price at posting:
0.0¢ Sentiment: ST Buy Disclosure: Held
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