"Mineral Resources (ASX: MIN) is a 19.9% shareholder in WC8, but with a stretched balance sheet (~$3 billion net debt), selling its WC8 stake could free up >$100m cash. As an aside, we think MIN could use the stake to negotiate a profitable, mutually beneficial mining services contract.
Wildcat offers exceptional relative value at c. $450m market cap. Azure Minerals (ASX: AZS) 70% stake in the Andover project (c. 200km from Tabba Tabba) was acquired for A$1.7 billion in May 2024 by Gina Rinehart's Hancock Prospecting and SQM (NYSE: SQM). Wildcat owns 100% of Tabba Tabba and holds a granted mining lease that could potentially enable lithium sales up to three years ahead of Azure.
We think this transaction will happen soon, with the pending maiden JORC resource for Tabba Tabba a likely catalyst for action.Pilbara Minerals refinanced its debt this month, freeing up $600m of dry powder (vs. WC8's market cap of $450m). Pilbara has a track record of buying countercyclically (see its acquisitions of Latin Resources and Altura Mining)."
Some interesting thoughts here given Matthew Banks recently said they will go it alone. No doubt AJ will get the best value for the quality asset. Intriguing to see how this one plays out. Bring on the MRE!
WC8 Price at posting:
35.0¢ Sentiment: Buy Disclosure: Held
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