Little known Metro Mining looms as Australia's next likely bauxite exporter after prevailing in the contested $50 million takeover battle for Queensland bauxite aspirant Gulf Alumina.
Confirmation that Metro had taken a controlling stake in Gulf came on the day that bauxite prices surged above $US50 per tonne for the first time since December 2015, and as prices for alumina and aluminium continue to rally.
Metro and Moly Mines had in recent months both lobbed takeover bids for Gulf, which has been developing a bauxite export business near Rio Tinto's Weipa operations on the Cape York Peninsula.
Metro already owned 39 per cent of Gulf from a previous takeover attempt when Moly started the bidding war in September.
Both bidders improved their bids several times before Moly was effectively ruled out of the contest on November 28 when the ASX declared it would not allow the company to resume trading.
Moly had been suspended from trading since April 2014 on the grounds that it no longer had any operating businesses, and appears to have suffered for its long-standing connection to controversial Chinese investor Hanlong.
Several Hanlong executives have been jailed for insider trading in recent years and the ASX ruling came despite Moly offering to remove Hanlong representatives from its board.
'Exceptional value deal'
Since Thursday, Metro received acceptances from the Gulf executives who accounted for about 55 per cent of Gulf shares, giving it more than 90 per cent control of the target.
Metro has bauxite tenements that are adjacent to Gulf's, and Metro boss Simon Finnis said he hoped the combined company could be exporting bauxite by 2018.
"We think this is a great deal with great timing and it is an exceptional value deal," he said.
"From a geographical point of view it is completely logical that these things should be together."
When asked if the acquisition made Metro a natural takeover target for Rio, Mr Finnis said: "Who knows what is going to happen in the future, we just want to get into business."
Metro was backed by London lender Greenstone Capital, which will also become the largest shareholder in the combined entity.
Metro shares were fetching as little as 4.5¢ in January but they have since more than tripled, and at 15.5¢ on Monday were fetching their highest price of 2016.
Bauxite was traditionally mined by vertically-integrated aluminium producers, but with China short of high quality bauxite, aluminium producers such as Rio and Alcoa are starting to export the bulk commodity from Australia to rival aluminium producers.
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