In my opinion, several parties are watching and waiting for...

In my opinion, several parties are watching and waiting for Syrah to:

1) Complete construction of Balama; and
2) Successfully commission the mine.

Possible contenders for a takeover include: South32, Fortescue Metals, Rio Tinto, Glencore, and Marubeni amongst others. I include Marubeni because they've been testing Syrah's graphite for a long time, they've been a loyal partner, they'd see the final demand coming through from battery anode manufacturers, and they have a history of vertically integrating (e.g. paying $3.6 billion for Gavilon in 2012).

	Column 1	Column 2	Column 3	Column 4	Column 5	Column 6
1	($USD Millions)	South32	Fortescue	Rio Tinto	Glencore	Marubeni
2	Most recent annual cash from operations	2132	4256	8465	9722	2947
3	Most recent annual capex	(344)	(729)	(3012)	(4489)	(1191)
4	Proxy free cash flow (ignoring CFF)	1788	3527	5453	5233	1756
5	Cash Balance	2778	1838	8099	1973	8033

Several of the candidates have been using their free cash flow over the last few years to pay down debt and repair their balance sheets.

Fortescue Metals' Debt:



Rio Tinto's Debt:


Note: Total debt 15.48b at 30 June 2017

Glencore's Debt:


Note: Total debt fell to 30b by 30 June 2017

Noting Andrew Forrest's comments on March 24, 2016: "We are incredibly interested in lithium, graphite, copper" Fortescue with it's healthy balance sheet looks like a very probable candidate now that BTR has signed a 30,000 ton offtake which will expand as electric car production in China increases.

Finally, it's important to recognise that a larger company could create more value (than current analyst valuations) by rapidly deploying cash into large quantities of spherical graphite capacity, lowering electricity costs at Balama, and building a vanadium production facility. Because Syrah is valued using a high discount rate, by bringing cash flows forward, significant value is created for a control buyer.