For those with short-term inclinations, today's trading in...

For those with short-term inclinations, today's trading in Kalahari was quite interesting. However, volume was low, so I don't know whether too much can be read into it.

The shares moved down early, touching 93p at the low (having closed at 101p on Friday). I also noticed that a large sell order was placed slightly above the offer. Smelt like a scare tactic to me, trying to shake out some nervous holders. After the tactic had succeeded ;0), the price recovered throughout the afternoon and closed only slightly down @ 98.5p. (On a big down day in London & New York).

Taking a bigger picture view, I do think there is an element of "bid premium" in Extract and Kalahari's SPs right now. I suspect quite a few speculators joined in last week. As has been mentioned, it will be very interesting to see the new top-20 list.

However, as I mentioned quite some time ago, given how tightly Extract's shares are held, I don't think another bidder, such as Areva, would bother to attempt to buy shares in the market. If they did do that, it would drive the price up dramatically (which they obviously wouldn't want) and probably wouldn't net them very many shares. ISTM that a more sensible approach for anyone other than RIO would be to just slap an offer for the whole company on the table.

As I've mentioned in London, making an offer for Kalahari could be a precursor to this. If a bidder (other than RIO) succeeded in acquiring Kalahari that would immediately scupper RIO's plans. RIO's 16% stake in Kalahari would not be enough to prevent an offer made by another party and recommended by Kalahari's directors from succeeeding. It would also move the other party a very big step closer to making a successful offer for the whole of Extract as they'd immediately have 40% of the shares in one fell swoop.

Coming back to the short-term, ISTM that the market is expecting a bid. If it comes this week - well there won't be too much more to talk about, except what price we expect it to succeed at. If it doesn't come this week, as Westie has hinted, we could see a drop off in EXT's share price as the speculators rush for the exits. For that reason, again, as I mentioned in London over the weekend, I reduced my Extract shareholding further on Friday - but still have 50% of my original holding.

Over the long-term, providing future drill results live up to expectations, shareholders should do fine. We already know that RIO want a JV. They've said so publicly. I find it improbable that RIO's competitors and U consumers will just take that lying down. Sooner or later there will be corporate action - either the JV or another offer, which will likely take the SP above where it was on Friday.

In the meantime, we're due an announcement from Kalahari on just how many EXT shares they now have, having exercised their options.

Also, shouldn't Extract make an announcement when RIO approach them, as RIO have said they intend to do?

Plenty of excitement to come. Good luck to those with the courage to hold through thick & thin.

Mark