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78.0¢ avz minerals limited

Running Commentary on the SP Movements., page-3160

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31/10/17

18:59

Post #: 28366236
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Does anyone have an example of Chin

Originally posted by 8horse ↑

Few historical Chinese acquisitions:

1. TianQi Lithium: Acquisition price was about A$163/t.

in 2012, acquired Talison (100%) for total about CNY5b (~A$1b) in 2012 before lithium boom, then sold 49% to Rockwood for US$475m; (Greenbushes deposit:118.5Mt @2.4% Li2O - 6.1Mt LCE)

AVZ's Manono deposit exploration target: 1Bt - 1.2Bt @1.25% - 1.5% Li2O (AVZ's shared mid figure: ~19.65Mt LCE, Three times of Greenbushes'.

Lithium price is up +300% since 2012.
Based on TianQi Lithium acquisition of Talison/Greenbushes depoisit in WA, for $1b in 2012,
AVZ's attributable Exploration targeted lithium resource is three times of Greenbushes',
Theoretically, $1b (TianQi Lithium paid) x 3 times deposit x 4 (300% increase in lithium price 2012-2017) = $12b,
then Discounted for RISK factor ratio (Early exploration stage, country risk)

2. LATEST ACQUISITION IN CHINA: Acquisition price was about A$297/t.

On 16 October 2017, a Chinese company bought 60% of a Canadan lithium deposit (still in development, not in production yet) with lithium resource of 14.25Mt @1.4% Li2O (M&I:12Mt), total LCE 0.258Mt for US$60m.

Yesterday, news reported, some shareholders of the vendor complained the project was sold too cheap.

3. AVZ current valuation : A$26/t on a fully diluted basis

AVZ's middle figure of attributable (Exploration target) LCE is about 19.7Mt.

AVZ, currently is standing at $26/t, compared with ASX peer's average $274/t;
recent China's acquisition of a small lithium deposit: $297/t.

DYOR & GLTAH.

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Does anyone know of a historical example of chinese takeover of a mineral deposit in DRCongo specifically? How much of a risk reduction/sovereign discount do they realistically expect?

AVZ Price at posting: 24.5¢ Sentiment: Buy Disclosure: Held
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0 Great analysis

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