Numbers of people on this thread have predicted that after the Chinese make their initial offer, Rio will make their own move.
I accepted this thinking, but am now wondering.
The Chinese own 12% of Rio through Chinalco. The Chinese need security of Supply for Uranium. Rio wants to remain a force in Uranium. Rio has a long history of partnerships with other parties, although it generally wants operational control. Neither the Chinese, nor Rio wants to pay more than is absolutely needed for the assets.
I now see no reason why Rio would not negotiate an agreement with the Chinese where ownership is shared - at the minimum amount that the major stake holders agree that they will sell for.
Under this scenario, there is no public auction (unless a third party decides to gate crash the party), merely an announcement that agreement has been reached between major holders.
Does this sound feasible, or am I dreaming?
In any event, today's price fall might be to make the suggested 2.70 takeover of Kalahari look more attractive.
EXT Price at posting:
$8.00 Sentiment: Hold Disclosure: Held
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