FLX has decided to divest the South Australian Coal (SAC) company which is located in South Australia.
Whilst it has been pitched as an asset for FLX shareholders it is nothing more than a ploy from Yanzhou Coal to streamline the acquisition process of FLX.
SAC's main asset is the EL3386 tenement in South Australian which is located next to the Woomera testing facility.
SAC has been removed from FLX so that the takeover bid can not be rejected on the basis on national security (e.g. Minmetals attempt to acquire Prominent hill).
Whilst there is expected to be $10m in cash I expect this to be depleted quickly in costs over the next 1 - 4 years.
I will be assigning $0.00 value to the SAC shares given to FLX shareholders.
Again I think that Yangzhou is acquiring high quality assets for a very low price.
Please DYOR
FLX Price at posting:
$17.19 Sentiment: Buy Disclosure: Held
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