When you consider that the price of Zircon is now worth far more than when AZC made it agreement with the Chinese company, I would suspect the value of APGs 20% would be much greater than the price AZC, as a distressed seller sold it for last year. To quote the last quarterly report from ALK which hopes to produce zirconia from it Dubbo project, "Zircon, derived from mineral sands mining operations in conjunction with the recovery of ilmenite and rutile, is the primary source of all downstream zirconium products. The zircon industry is experiencing a major supply deficit which continued to deteriorate throughout 2010 and early 2011 and has flowed on to the downstream zirconium industry with prices escalating substantially.
It is probably a blessing, other than the costs for the court case, that APG lost. The asset is worth a lot more now than when APG sold to it last year, particularly as AZC has yet to produce the BFS, and therefore is yet to earn its 80%.
APG Price at posting:
3.9¢ Sentiment: Buy Disclosure: Held
