the rio conundrum, page-4

Hi GDelaney,

Its hopeless for RIO to do a JV deal with EXT because KAH owns 43% of EXT. So whoever gets majority ownership of KAH also becomes the majority holder of EXT via a compulsory downstream offer for EXT.

I don't think RIO would want to partner with EXT and then have CGNPC (or someone else) running the show. Especially when you see what happened to Gindalbie when APAC took control.

Its impossible to say for sure what is happening behind the scenes or what the plan is. Maybe deals are being done between major shareholders? Or, perhaps they could be waiting on the Nambian government to deliver the ML and for Epangelo Mining to buy its slice of the action. As RIO, EXT and the Nambian gov are "mates", I think a deal might have just been done because RIO is now talking big to its shareholders on its uranium expansion intentions.

RIO wants Husab more than anything else because RIO is running out of uranium ore at Rossing & Ranger and the synergies make Husab very equitable. They only have to build a 6km conveyor and move their earth moving workforce from Rossing to Husab. (i.e. huge production in 4-6 mths and at low cost).

But it is also likely CGNPC will comeback with the agreed discount offer for KAH in 5 weeks or so. CGNPC also said it will counter bid if anyone puts forward takeover offer first. But at what point is there better value elsewhere for CGNPC?

cheers...