I've been contemplating this over the weekend and the more I think about it the more it makes sense. Perhaps I don't know enough about corporations law, but hopefully someone can fill me in if I'm mistaken.
We now know that Rio is transferring it's existing stakes in both EXT and KAH to the Rossing JV. I think it was equivalent to 20.9% in EXT (15% in EXT directly and 5% through its stake in KAH).
Could the reason for all the recent buying be due to RIO increasing its holding. You see once they've transferred their existing holding to Rossing then effectively they can purchase up to another 20% of EXT directly without having to make a t/o offer.
So in effect they could be starting their holding again from nil. If this is the case then through Rossing and a new shareholding of up to 20% they could hold almost 40% of EXT.
And if the same applies with Rio's KAH holding over in the UK they could easily be getting closer to holding 50% of EXT (directly and through KAH) over time between them and the Rossing JV.
Thanks again, Mick
EXT Price at posting:
$4.42 Sentiment: Buy Disclosure: Held
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