Before I had a bex and a lie down I'd want to make a careful comparison between the AXO share registry and EXT. Bottom line is here we have two (ok three with Polo) major SH all of which have a strategic plan to either: sell or develop.
For example: (a) Given KAH only really exists by virtue of its EXT position, a half-assed farm in type deal will simply not meet their financial/and or control aspirations. Don't forget this company owns nearly half the business, (not withstanding Rio's stake in them).
(b) Same story for Rio. Given their recent Asian dramas and clear intention to protect their flagship resources from Chinese attention via debt vulnerability (BHP deal in WA for example), (AND, their recent cashing up via divesting non-core assets) Its clear that no aquisition through the back door will ever get up, especially since this is right on Rossing's back door.
(c) the retail ownership of EXT (nor KAH/Rio for that matter, will not allow either: further dilution via a placement (we paid $7.75 for the last one) as this would be the thin end of the wedge re progressive loss of control...
or: an acquisition either on or off market for an amount less than the NPV, or at least the net average investment cost to date of any shareholder including us.
Therefore: as I see it IMHO, the only way forward as far as external interest in the business is concerned is an equity stake (15% has been bandied about) which could come from retail ownership, and is SP positive, A take off agreement which is SP positive, or a total TO which is now less likely but also SP positive. Lets face it, If the share registry were fully spread across the market, we'd be on the block already.
I frankly can't see KAH/Rio et al offering even a modicum of control. The only way other than off-take, that I can see major external involvement happening given the current boardroom stalemate, is via the market (on or off), and unless RIo/KAh etc want to give up their ripe plum, this has to come from retail SH.
EXT Price at posting:
$7.12 Sentiment: Buy Disclosure: Held
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