# CSM - Consolidated Minerals



## Jay-684 (15 February 2005)

Bought into these at $1.59 last year, current'y at $3.02, however seems to be on a downward trend lately from a high of $3.46 only a few weeks ago.

What are peoples opinions on this stock? done its dash or just a correction?


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## crocdee (16 February 2005)

*Re: Consolidated Minerals CSM*

CSM are a major holder of ATX who have good nickle ground around coolgardie and are getting very close to production

regards croc


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## Yippyio (5 October 2005)

*Re: Consolidated Minerals CSM*

FYI - Mining News Article


Boom times for the 'next BHP'


Monday, October 03, 2005
WITH record profits and dividends galore, this market darling has no plans to slow down. By Michael Quinn - RESOURCESTOCKS*

It has been one of the real standout miners over the past couple of years, achieving multiple capital growth and paying nearly $70 million to shareholders in dividends. The question is, where to from here for Consolidated Minerals?

Fiscal 2005 was an absolute boomer for ConsMin. Net profit went from a little over $25 million in 2004 to more than $70 million, including a trading profit of some $51 million out of earnings of $110 million (EBITDA).

While most of the increase was attributed to the strong commodity prices, volume increases also played a role as production increased at the company's mainstay Woodie Woodie and Coobina operations in Western Australia.

This year the miner is pumping for gross earnings of $140 million, with the forecast predicated on increased production of manganese and chromite (and a 15% decrease in prices), and a growing contribution from nickel. 

ConsMin managing director Michael Kiernan is unfazed by queries over the manganese price, which, especially in the shorter term, would clearly play the lead role in acting out ConsMin's forecasts. 

While the price has been down on the highs of the last couple of years, he points to its historical alignment with iron ore prices – which, incidentally were upgraded by one prominent brokerage/investment bank last month (September) despite the staggering gains made at the last round of price negotiations – plus the "quality" of Woodie Woodie's high-grade product and ConsMin's independent supplier status.

"What happens to iron ore will happen to manganese," Kiernan says.

Meanwhile, ConsMin's reliance on its manganese earnings will lessen as its nickel strategy kicks in over the next couple of years. Manganese's contribution to earnings is expected to slip from around 70% to 40%, at which point nickel will be delivering a similar percentage. More on that later. 

Cutting to the chase, over the next three-to-five years, ConsMin managing director Michael Kiernan is targeting a capitalisation that's at least twice that of current levels. On top of the capital growth, investors can also look forward to at least 50% of the company's profits being returned to them in the form of dividends.

The dividends provide a beguiling mix indeed, and a major point of difference from most of the rest in the notoriously capital thirsty resources sector. 

A strong endorsement of the veracity of ConsMin's ambitions is to be found at Macquarie Bank, which recently published comprehensive research report on ConsMin startlingly titled - "Building the next BHP?"

Macquarie's claims for ConsMin note the miner's aggressive organic growth phase of recent years, two ambitious company-changing deals – a failed merger attempt with second tier iron ore producer Portman and more recently a near-miss with the world-class Hope Downs iron ore project – and a host of investments in a range of small explorers.

Macquarie's "price target" was $4.15 (in late-July), with company's valuation on an "as is" basis that excluded the near mine exploration potential and growth strategy, both of which it said have the ability to add "considerable value" in the short term.

The investment bank claimed ConsMin had the necessary building blocks in place "to develop into a major diversified mining house", and was primed for further corporate action. 

"As part of building a portfolio of diversified mining assets, ConsMin is likely to undertake a considerable amount of corporate activity, at either the company or the asset level," Macquarie said.

"While this adds a layer of acquisition risk, ConsMin has managed to ameliorate some of this risk through the use of ConsMin scrip as consideration.

"Also ConsMin's 'shot gun followed by rifle shot' approach has proved successful."

This colourful description refers to ConsMin's strategy of initially making multiple investments in promising exploration companies, before…


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## Yippyio (5 October 2005)

*Re: Consolidated Minerals CSM*

Article Cont. - Part 2

Boom times for the 'next BHP' - Part 2


Monday, October 03, 2005
This colourful description refers to ConsMin's strategy of initially making multiple investments in promising exploration companies, before taking that investment further in individual companies or projects if subsequently warranted.

The effectiveness of this approach was recently played out in the case of Titan Resources, with ConsMin deciding to step away from its initial investment in Titan before subsequently taking a joint venture option over one of the junior's more advanced nickel assets – Armstrong.

Other investments include just under 20% of nickel-copper explorer Mithril Resources, and a similar stake in budding copper-zinc miner Jabiru Metals, which is in the process of becoming a 8000-10,000 tonnes per annum copper and 20,000-25,000tpa zinc producer (as well as around 800,000oz of silver). Kiernan anticipates a doubling of these production rates, and ConsMin is widely considered likely to end up with up with either the bulk of the project or Jabiru itself. 

However it really is nickel that is at the core of ConsMin's efforts to stay on the high side of the growth road. 

Production from the company's assets in the Kambalda region is being targeted to grow around five-fold over the next five or so years - from around 4000-5000tpa to some 20,000-25,000tpa.

Output from the existing Beta Hunt operation plus the developing East Alpha mine will push ConsMin's output to an annual rate of around 10,000t in the current fiscal year.

Kiernan says the aim is to develop a mine a year for the next few years, with Foster likely next year and exploration worth around $10 million per annum being undertaken to ensure it remains a reality thereafter.

Current resources stand at some 74,000t of contained metal, with immediate potential seen to increase in a 400m area between East Alpha and the historic Silver Lake mine to the north, WMC's original mine at Kambalda.

Meantime, the company is also planning to build its own concentrator in the Kambalda region, and, significantly, it is likely to introduce a Chinese partner into the development despite the mooted $15 million or so plant cost being but a minor percentage of ConsMin's current cash holdings. 

"Hands over the sea" is how Kiernan describes this "strategic partner" initiative, which would seem more than likely to attract serious attention from resource hungry groups in China. 

Further down the track, the company's iron ore assets (Mindy Mindy, Shaw River) in the Pilbara will emerge, with the lack of available infrastructure the current constraint. ConsMin's relationship with the ambitious Fortescue Metals Group is the key to unlocking the value in these assets.

For those bullish on China, and hence the commodities being produced by ConsMin, the following comments by analysts Huntleys succinctly capture the essence of the company.

"In a few short years, CSM has developed a reputation for aiming high and delivering the goods," Huntleys said.

"Return on equity has averaged a stunning 40% per annum for the past five years … (while) dividends have compounded at an impressive 63% per annum over the last four years, with more to come. 

"CSM has a modest forward PE and attractive fully franked yield (at a share price of $4.02).

"The company has shown it can successfully grow through exploration, expansion and acquisition. China provides CSM an opportunity to grow into the vacant mid tier mining space. 

"The company is moving rapidly and efficiently to take advantage of the cyclical upturn with an impressive armoury of growth options." 

* This report, first published in the September/October 2005 edition of RESOURCESTOCKS magazine, was commissioned by Consolidated Minerals


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## amohonour (27 October 2005)

*Re: Consolidated Minerals CSM*

Can this company still pull things off without Keirnan or are they going to be just as strong? sp seems to say otherwise lately.


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## Kauri (28 October 2005)

*Re: Consolidated Minerals CSM*

I tend to think that CSM has been way oversold on the news of Kiernans departure, I admire the way he built the company up from nothing, but to say he was worth 30% of the companies market cap is, I think, overdone. Will be waiting patiently for a chart based signal to enter when insto's have settled down.

 West Australian today
 ConsMin eyes buy-back

MICHAEL WEIR


Consolidated Minerals is likely to start buying back its own shares on the market after a 10 per cent slump yesterday to a six-month low overshadowed plans for a major $120 million expansion of its Kambalda nickel operations.

Managing director Michael Kiernan said the share rout, triggered by an investment fund dumping stock, was a "serious overreaction" and one that could trigger buying under the company's 5 per cent share buy-back program. ConsMin last bought shares under the facility in March when the share price was around $3.20, just 5 ¢ below yesterday's close.

Market traders said yesterday's 35 ¢ share price hammering, the heavy volume of 5.4 million shares and the aggressive nature of the sell-down suggested an insititutional investor had quit its position.

Southern Cross Equities was behind the selling, feeding 3.4 million shares into the market and was still offering more than 160,000 shares at $3.25 at the close.

"They didn't want to scare the market so they drifted in and sold all day, but when they exhausted the buying they have driven the price down to get some volume happening," one stockbroker said.

Nearly $160 million, or 18 per cent, has now been wiped from ConsMin's market value since WestBusiness revealed two weeks ago that Mr Kiernan was planning to leave after institutional shareholders raised concerns about a new lucrative employment contract for the chief executive.

Yesterday marked the first exit of one of the company's institutional shareholders since the pay row, with the bulk of the earlier selling coming from retail shareholders concerned about what impact Mr Kiernan's exit would have on the company.

The manganese and chromite miner revealed yesterday it had its sights set on becoming a major nickel player in Kambalda by building a $25 million stand-alone concentrator capable of producing up to 25,000 tonnes of nickel concentrate a year, in competition with BHP Billiton's WMC processing operations.

ConsMin's concentrator would be fed from a planned $95 million underground expansion of its existing operations, picked up in last year's $76 million takeover of Reliance Mining, and would also be open for business as an alternative treatment option for other miners in the area.

Mr Kiernan said the nickel expansion would help unlock the broader nickel potential of the area.

"Based on the geological assessment of our team as well as historical data and mining information, we believe that there is a potential nickel endowment of up to 240,000 tonnes with an in-ground value at current nickel prices in excess of $2.5 billion if the mineralisation is shown to be continuous," he said.

He said the first phase of the programe involved the $45 million development of twin exploration declines to access a potental 90,000t of nickel about one to 2km to the south-east of the current Beta Hunt-East Alpha mine.

If that program was successful, ConsMin would commit a further $50 million, funded out of cash flow, to further extend the twin exploration declines 3km to the south, targeting an estimated potential nickel endowment of up to 150,000 tonnes.

Feasibility studies on the plan are being finalised and the board is expected to make a final decision at its November meeting.

"But it is one of those things I would say is a must-do, not a like-to-do," Mr Kiernan said.

He said the company would make a decision before December on pushing ahead with plans to establish its own concentrator in Kambalda. He said the company was looking at the possibility of converting the old Burbanks gold mill from Coolgardie into a nickel processor, which would help cut the development time from two years to 12-18 months.

"To get our own concentrator gives us greater revenue per tonne, reduces our conversion costs and also gives us the ability to blend other ores, particularly (Titan's) Armstrong ore, and also acquire nickel from other players," he said.

"We then sell our concentrate direct to China."


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## Lachlan6 (28 October 2005)

*Re: Consolidated Minerals CSM*

Howdi Jay. From a technical perspective, it would seem that this weeks action has been very negative for CSM. In fact todays fall has seen a crucial support level at around $3.20 fail. This weeks fall has been accompanied by huge volume  which has further negative reprocussions. OBV has dropped off, while there has also been negative divergence in the RSI. I personally would not be holding this stock in my portfolio after this weeks action. Another option is to go short as a CFD and leverage the downside. If I am wrong, CSM would need a strong surge back through $3.20. Definenetly a possibility. However the smart money seems to be getting out of CSM currently. Just my opinion. Cheers mate.


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## dandyandy (30 October 2005)

*Re: Consolidated Minerals CSM*

CSM support level is $3.00...short-term resistence should be $3.25.

It should rebound from here, but await some directions from LME i would say and hopefully through mid November will recover to be above $3.50.

There are also rumours of a share buyback in the immediate future which should hold prices above $3.25.

Just have to wait and see...

note this isnt advice just my thoughts.


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## amohonour (31 October 2005)

*Re: Consolidated Minerals CSM*

I think this is one of those stocks that i will be saying to myself later that i could have bought in at 3.00 if you know what i mean. Still remember when mining news article branded thisone as the next BHP big call but if they are right imagine what 3.00 wiil look like then lol i got out and not back in yet will live to regreti it im sure


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## Kauri (1 November 2005)

*Re: Consolidated Minerals CSM*

Kiernan moves to steady ship

MICHAEL WEIR

Outgoing Consolidated Minerals boss Michael Kiernan has offered to stay at the manganese, chromite and nickel miner until mid-2007 after an outcry by small shareholders over his decision to quit next year in the wake of a pay row with some institutional investors.


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## Kauri (7 November 2005)

*Re: Consolidated Minerals CSM*

Well CSM may :dunno:   be forming a reversal triangle, too early to say if it is an ascending or equalateral, or indeed a triangle at all, also would have more confidence if it was bouncing off atrend line or support/resistance but still warrants watching for mine.


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## Lachlan6 (7 March 2006)

Just a quick note on CSM. I posted late last year in October that CSM had breached support which indictated a very negative signal for this stock. Well since then CSM has been punished. It closed that week at $3.12 and is currently trading at $2.26. It has broken through 50% fibonacci retracement support and its next support is around fibonacci $1.80. OBV has fallen through the floor. Dont want to be too negative , but it can be painful ignoring strong technical signals, especially when they are on the downside. (Unless you are short selling )


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## Ann (8 March 2006)

Hi Lachlan6,

It does seem to have a battle on its hands doesn't it? 

Let's see if the reaction to the recent Open Briefing will breath new life into the price.

6/03/2006  	Cons Minerals. MD on Results & Growth

http://www.corporatefile.com.au/documents/OB/MD on Results & Growth 06.03.06.pdf


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## Jay-684 (9 March 2006)

doesnt look good 

I'm just pleased I sold @ 2.60 last week, after weeks of waiting for it to get back up to $3.00

still a 80% profit so not unimpressed, just a far cry from the 160% it was returning 12 months ago


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## redandgreen (4 April 2006)

to those who follow this stock,
 your thoughts would be appreciated.
Should I continue to hold or is it headed back down again?


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## Broadside (4 April 2006)

I am a long term holder.  It has been a bumpy ride the past year, am hanging on it has good exposure to the resources boom and especially China, I  think it is a stock worth holding long term IF you believe the resources boom can continue medium term. Here is a good article for you to read which gives an overview of where we are now at:

from Australian Financial Review

ConsMin fights to restore credibility
Author: Jo Clarke
Date: 23/03/2006
Words: 885
Source: AFR
Publication: The Financial Review
Section: Market Wrap
Page: 25


It has been a tough six months for Consolidated Minerals, with a collapse in the manganese price and disruption in the top management interrupting the company's ambitions to fill the gap left by the recent disappearance of WMC Resources and MIM.
The next 12 months is crucial as the company moves to further reduce its reliance on manganese and chromite, while new managing director Rodney Baxter stamps his authority on what has long been predecessor Michael Kiernan's baby, with plans to invest overseas.

Mr Baxter will assume the top job on July 1 and plans to be his own man despite the enigmatic Mr Kiernan remaining on the board as a non-executive director.

Mr Kiernan announced his resignation in October after a handful of fund managers refused to endorse his remuneration package.

"The new MD is a bit more old-school in terms of mining, a bit more conservative and reserved, but that is not to say that he won't put his own stamp on the direction of the company," BT portfolio manager Tim Barker said.

The changeover is likely to lead to volatility in the ConsMin share price in the next few months while the market gets used to Mr Baxter, another analyst said.

"People don't like change, they want evidence that he will be able to deliver, particularly as the company has been through some tough times lately," he said.

Mr Baxter, with his background at Anglo American in South Africa, has already flagged a desire to turn ConsMin into an international company. Africa is high on Mr Baxter's list of potential investments, but that may not be appreciated by ConsMin's Australian shareholder base.

"The Australian market will try to ignore it," Mr Barker said.

"African assets have always been discounted by the Australian market, but that is not to say that others - most noticeably the Canadians - will not value it."

ConsMin, under Mr Kiernan, has been accused of a scatter-gun approach to acquisitions and Mr Baxter will have to be careful not to perpetuate this in his overseas ambitions.

An eastern states roadshow by Mr Kiernan and Mr Baxter earlier this month has boosted the share price by about 25? to $2.50, but it is still well below the high of $4.38 achieved in August before Mr Kiernan resigned and the extent of the manganese cool-down became apparent.

Mr Kiernan recently reiterated the company's philosophy of returning at least 50 per cent of profits to shareholders, while continuing to seek acquisitions.

Analysts expect ConsMin to pay a total dividend this financial year of about 10? a share, giving a yield of around 4 per cent, broadly in line with that estimated for nickel producer Minara Resources, but well above the prospective 1.76 per cent for diversified miner Straits Resources.

ConsMin is trading at 20 times estimated 2006 earnings, well above the price-earnings multiples of 7.5 times for Minara and 8.6 times for Straits Resources.

The high multiple is in part due to depressed forecast earnings of about $25 million because of an expected fall in manganese prices and volumes, particularly in the first half of the financial year.

The company was built on manganese, but the manganese market - dominated by BHP Billiton and Brazil's Companhia Vale do Rio Doce - has suffered falling prices in the past 12 months because of oversupply and destocking by Chinese alloy producers.

The price has fallen sharply from a high of $US4 a tonne in early 2005, but seems to have levelled out at about $US2.50 as Chinese buyers return to the market.

ConsMin remained bullish on manganese prices throughout 2005, despite the falls, and lost a certain amount of credibility in the market.

From manganese it was a logical step to buy the Coobina chromite mine - both commodities are used in steel making and have significant marketing synergies.

Mr Kiernan has said publicly he will not invest in any more chromite mines once Coobina runs out of ore, because the barrier for competitors to enter chromite mining is too low.

After chromite, Mr Kiernan turned his attention to nickel, with the acquisition of Reliance Mining last year.

ConsMin is also in a joint venture with Titan Resources to develop the Armstrong nickel deposit.

The Armstrong ore was rejected by BHP because its specifications did not meet the Kambalda concentrator's needs and ConsMin is threatening to build its own concentrator to process it.

There has been speculation that ConsMin will move to take over Titan, although this may not be on the agenda of the new boss.

Buying into Jabiru Metals was ConsMin's first move into base metals.

Mr Kiernan is keen to gain control of Jabiru's Jaguar copper-zinc project, but so far Jabiru MD Gary Comb has rejected advances regarding a joint venture.

"The 30 per cent [holding in Jabiru] is probably enough in terms of having sufficient influence over what the company does," Mr Barker said.

But to be able to do exactly what it wanted, ConsMin would have to take over Jabiru, and that was unlikely to happen until the Jaguar project was much closer to production.


KEY POINTS

* Rodney Baxter takes over as managing director on July 1.

* Baxter is considered an 'old-school', conservative miner.

* ConsMin lost credibility over its optimism on manganese prices.


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## redandgreen (4 April 2006)

very useful 
thx
probably sit it out until end of June (and hopefully beyond....)


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## RichKid (4 May 2006)

Looks like CSM is struggling again, could be in for a fight with the Titan takeover, still quite a way from the recent bottom but it only takes a little bit of a push with volatile stocks like this to get it going down again.


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## GreatPig (4 May 2006)

RichKid said:
			
		

> Looks like CSM is struggling again



Sold it today after yesterday's drop through the $2.60 level.

Was hoping for an up-side break out of the triangle.

Cheers,
GP


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## Kipp (4 May 2006)

GP- are you sure there isn't some long-term value here?  CSM has been punished by the market, but Hartley's, Patterson's, ABN Amro and co have all given BUY valuations in recent reports (valuation s of ~$3.20) and pretty healthy FY07 profit forecasts of in th 55-65mill range.
Equally well, Huntley's has admitted they had BUY or Hold for CSM in 05 when it went down the sink.

CSM also positive ASX announcement today (increased nickel grades) but nothing could stop the horror run of today... all of my watchlist in the red!  (Except IDO which had a cracking day.. up 16%!)

Fin Review suggests CSM might have some competition for Titan, but even if it misses out still retains a 20% stake and some 33% of JML.


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## RichKid (5 May 2006)

Looks like the market didn't care much for the positive Nickel announcement which came out mid afternoon, selling continued strongly into the close of trade, high volume, wide ranging down day, not good, I have a feeling there may be more bad news to come, the price chart suggests it- or maybe it was just a lot of weak hands being shaken out due to general bearish sentiment? We'll know in the next two or three days once the trend is confirmed or reversed.

PS. I like this stock fundamentally but as a trader there is no reason for me to go long atm.


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## Kipp (5 May 2006)

RichKid said:
			
		

> Looks like the market didn't care much for the positive Nickel announcement which came out mid afternoon, selling continued strongly into the close of trade, high volume, wide ranging down day, not good




Hard to read too much into it though... it was such a horror day for all!!!  

But the fundamentals sound nice (course if Mn slips any more profit downgrades for 07 and 08 are pretty severe)


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## GreatPig (5 May 2006)

Kipp said:
			
		

> are you sure there isn't some long-term value here?



There could well be, but for me this was a trading stock that failed according to my management plan. Success was an upward break out of the triangle, failure a close below $2.60.

It failed, it went.

Cheers,
GP


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## GreatPig (5 May 2006)

<sigh> why doesn't that surprise me...

GP


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## Kipp (10 May 2006)

Richo, GP- do you think that CSM revised bid for Titan is a bit excessive?  Or still reasonable at 1:27 ratio?


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## RichKid (10 May 2006)

Kipp said:
			
		

> Richo, GP- do you think that CSM revised bid for Titan is a bit excessive?  Or still reasonable at 1:27 ratio?




Hi Kipp,
To be perfectly honest: I have no idea, but judging by their Nickel strategy and long term outlook for Nickel it should prove to be reasonable, but the TTN holders are getting a great deal as CSM sp is very low atm imo and the new offer is a big improvement on the first, the TTN directors have done well, I assume this is all at arms length as CSM owns a big chunk of it. I'll search for some articles on the deal and post it here, please do the same if you find anything.
I haven't read the open briefing yet, that might have clues, announced today.  Eitherway I like CSM.


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## noirua (24 May 2006)

CSM have collapsed from the $4.50 level and now is the time, imho, to start looking at them again. Now is the time to consider a contrarian view.

The share buy-back is about halfway through now and stock is being cancelled at a low price level.
CSM announced an increase in their holding of Titan from 26.22% to 28.09%. 

This stock still has a strong following in the UK ( CNM or CNM.L ) and is still one of the Aussie success stories on the LSE.AIM market.


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## noirua (6 June 2006)

Still interested in CSM and wondering when a move should be made, as I'm trying to avoid catching the falling knife. They are determined at the moment to continue building their holding in Titan despite many voicing concern. Perhaps an opportunity to buy a little cheaper will raise its friendly head.


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## mlennox (6 June 2006)

After presentation to Sydney mining club yesterday where profits for 07,08 were forecast to powerfully to profitability.

Against the trend of the market today CSM has rallied strongly and on accompanying volume. The stochastic shows it is oversold and may be ready to reverse from the current downtrend. Be alert for break of downtrend and aggressive traders could look to take part position here. Stop loss on break of days low $1.73

Like richkid said just my opinion take it with a grain of salt


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## RichKid (6 June 2006)

mlennox said:
			
		

> After presentation to Sydney mining club yesterday where profits for 07,08 were forecast to powerfully to profitability.
> 
> Against the trend of the market today CSM has rallied strongly and on accompanying volume. The stochastic shows it is oversold and may be ready to reverse from the current downtrend. Be alert for break of downtrend and aggressive traders could look to take part position here. Stop loss on break of days low $1.73




Still looks in the doldrums to me, have to question management credibility re profit forecasts after this year's anncts. Look at the number of times it appeared to 'break' the downtrend, only to fall further. No one should construe posts on ASF as constituting financial advice of any kind.

RichKid
moderator


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## scsl (7 August 2006)

has CSM finally fallen enough?? it seems to have found support around the $1.70-$1.80 level... however, i am not yet confident of buying because when it last found support levels on the way down from its peak one year ago, it has continued to break these levels and fall.

is anyone buying CSM atm or contemplating it?


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## noirua (7 August 2006)

scsl said:
			
		

> has CSM finally fallen enough?? it seems to have found support around the $1.70-$1.80 level... however, i am not yet confident of buying because when it last found support levels on the way down from its peak one year ago, it has continued to break these levels and fall.
> 
> is anyone buying CSM atm or contemplating it?




I am still contemplating buying CSM. Uncertainty is the name of the game both on Aussie and UK bulletin Boards at the moment.

Probably worth more than $1.79 but may go lower, all the same, in the short term.


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## Ken (11 October 2006)

CSM's richard carter just bought 100,000 shares.


if the price breaks $2 could this be seen as a buying opportunity


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## GreatPig (11 October 2006)

CSM appears to be forming a slow fan bottom.

I had considered buying it yesterday, and again earlier today, but now it's too close to the $2 mark, which matches the recent peaks and also the main downtrend line. If it drops down around the $1.70 mark again, or breaks above $2, I'll probably consider it again.

Cheers,
GP


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## Ken (11 October 2006)

taking the stock as a long term view and not as a day trade how does it look?


i think if resources will continue to fire and they are set to benefit if management can get there **** together


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## Freeballinginawetsuit (16 October 2006)

CSM seems to have broken through the $2.00 resistance with volume confirmation. Could be the start of something!.

Its been a decent channel trader for 4 months but could be on its way to a return to a decent/fair value SP. 

It has plenty of potential, but crap a MD that was replaced months back, so hopefully the new team is turning them around.


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## porkpie324 (16 October 2006)

Holding CSM I got through Titan res. Hav'nt done much when compered to other miners, I think they suffered by being to optomistic and not living up to expectations also change in CEO did'nt helpporkpie


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## Freeballinginawetsuit (16 October 2006)

The most volume I've seen for months in CSM and above its old resistance, could be gathering a bit of momentum.

Pretty fair value as a Company at the moment, if they get their act together and realize some decent production/cost structure on their assets.

Could get close to their old highs, they've certainly been lagging behind!.


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## MalteseBull (18 October 2006)

I've been hearing that CSM is a possible takeover target on the hotcopper forums.... don't think there is much meat behind those opinions though..

other than that who ever said it was dead and burried is wrong... broke the 2.20 resistantce last week and heading towards 2.50...

worth looking into..

26th october is their AGM for anyone interested


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## Broadside (18 October 2006)

MalteseBull said:
			
		

> I've been hearing that CSM is a possible takeover target on the hotcopper forums.... don't think there is much meat behind those opinions though..
> 
> other than that who ever said it was dead and burried is wrong... broke the 2.20 resistantce last week and heading towards 2.50...
> 
> ...




I actually think there is something to the rumours, the volume and price rise would suggest so.  It has been out of favour for a little while and is ripe for the picking.


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## porkpie324 (18 October 2006)

CSM has suffered because the CEO (now retired) was far too optimistic about the company's profit forecasts,CSM failed to achieve the CEO forecasts which the market as usual hit the sp hard, so the sp was in a steady decline, about june time there was an increase in volume with an increase in the sp, the sp rose but soon drifted back again and has been in a sideways movement since then. But this week CSM may have shaken off these blues theres been a good sp rise on well above average vol, so CSM I think is a specky buy until the trend is confirmed.porkpie


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## Broadside (18 October 2006)

porkpie324 said:
			
		

> CSM has suffered because the CEO (now retired) was far too optimistic about the company's profit forecasts,CSM failed to achieve the CEO forecasts which the market as usual hit the sp hard, so the sp was in a steady decline, about june time there was an increase in volume with an increase in the sp, the sp rose but soon drifted back again and has been in a sideways movement since then. But this week CSM may have shaken off these blues theres been a good sp rise on well above average vol, so CSM I think is a specky buy until the trend is confirmed.porkpie




there is no doubt in my mind it is being hunted, there is big buying now at $2.40...not just a matter of it being back in favour...this was around $1.80  a week ago


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## porkpie324 (18 October 2006)

Broadside said:
			
		

> there is no doubt in my mind it is being hunted, there is big buying now at $2.40...not just a matter of it being back in favour...this was around $1.80  a week ago



I hope your right I'm sitting on holding from Titan Res, CSM has been off my radar for a while so I might take more of an interest now, posiibly take out a CFD position.porkpie


----------



## MalteseBull (18 October 2006)

this is one bullish share atm..

wouldn't mind increasing my hold when it goes down again


----------



## alankew (18 October 2006)

According to IG news feed they have received an approach from an unamed 3rd part.Item is copyrighted so could paste it up  but i think there is mantion of the asx newsdesk if thats any help


----------



## Ken (18 October 2006)

hmm, i am pretty sure i asked the question on this one.

was definitley out of favour at the time.

didn't put up....

patterson's had it as a definite buy....


----------



## Ranger (22 November 2006)

Just wondering if anyone is watching CSM at the moment? 

It is currently sitting on $1.985, Directors have bought in the last few months and a few analysts are starting to recommend BUY.


----------



## noirua (22 November 2006)

Starting to move with all the talk about iron ore. Scrambled on board this morning just after the train left, slightly late.


----------



## Freeballinginawetsuit (22 November 2006)

I'm onboard CSM again today also Noiura, . Shown a good support level during this recent correction, indicators are just crossing and its a tad oversold . 
Should bounce a bit and its still way undervalued IMHO, one of the only ones left that is no wear near May's SP levels.
Management needs to deliver some good output/cost effective and profitable outcomes in their next load of announcements and deliver on CSM's potential. The SP should reflect the aforementioned if this happens and then their is also the 'takeover' possabilities.
CSM are cheap ATM, have good assets and must surely be attractive to the bigger outfits  .


----------



## Sultan of Swing (22 November 2006)

Bought a few in March at 2.80ish, the old 'catching a falling knife' trick and watched as they dropped to 1.60.    Bought a bunch more 2 weeks ago. 

To me, they're one of the few resource stocks that seem undervalued. I'm cheering for them to have a lot more days like today.  : 

NOTE: Do your own research, I'm just a novice.


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## noirua (22 November 2006)

Providing we do not have " Costello " open his mouth too often on his views on commodity prices, then we should see CSM recover quite strongly.  I say quite strongly, as CSM may take a while to attack its previous highs as confidence has fallen a lot.


----------



## Ranger (7 December 2006)

Annoucement out: CSM still in negotiations with a third party regarding possible transaction. 

This could be reason for the rise today.


----------



## noirua (7 December 2006)

Ranger said:
			
		

> Annoucement out: CSM still in negotiations with a third party regarding possible transaction.
> 
> This could be reason for the rise today.




The iron ore sector is increasingly in the news of late and CSM appear left behind.


----------



## Freeballinginawetsuit (7 December 2006)

Nice open with some volume for CSM, unusual for them, they mostly have a slow wag!.


----------



## Freeballinginawetsuit (7 December 2006)

Strange for CSM today, responding well to sell pressure and maintaining bullish volume, could be something suss up!. 

Thought I might add that it couldn't be anything to do with their outstanding profits, they yet again announced that their not realizing output as per forecasts (last announcement), so indeed its strange their performing and indeed on a down market day.  , not like CSM at all.


----------



## Devil_Star (8 December 2006)

The stock price just rallied at the last half hour of trading. it looks like some insiders knows something good is happening. It sounds like another takeover. If there weren't the bad news about the ore downgrade, the sp might have gone further. Can't wait to know what happens!


----------



## mmmmining (8 December 2006)

Devil_Star said:
			
		

> The stock price just rallied at the last half hour of trading. it looks like some insiders knows something good is happening. It sounds like another takeover. If there weren't the bad news about the ore downgrade, the sp might have gone further. Can't wait to know what happens!




I still cannot figure it out how can CSM keep secret for so long by tell the whole world that A, I mean A third party is talking to them about a deal without name it? You and I might not know it. How about the insiders, the big firms, fund managers, brokers, friend of the insiders?

Either the board or the management fibericating story, or they failed on their duty to keep us informed. What is wrong to tell us the name? Is there any secrets?


----------



## noirua (8 December 2006)

Oversold on the UK AIM market as tipsters said, take profits.


----------



## noirua (11 December 2006)

Now at $2.18 with the chart targets set at $2.50 and $2.80. If CSM reaches these levels it will be time to see if the recovery to over $4 .00 is a possibility.


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## redandgreen (11 December 2006)

mmmmining said:
			
		

> I still cannot figure it out how can CSM keep secret for so long by tell the whole world that A, I mean A third party is talking to them about a deal without name it? You and I might not know it. How about the insiders, the big firms, fund managers, brokers, friend of the insiders?
> 
> Either the board or the management fibericating story, or they failed on their duty to keep us informed. What is wrong to tell us the name? Is there any secrets?



IGO you have only to compare the SP behaviour of the two companies over the last 2 months ...very revealing.
Conjecture only of course
IGO SP  went down in direct proportion to CSM SP going up


----------



## Freeballinginawetsuit (11 December 2006)

CSM needs to close above $2.20 with some more volume and I'll be happy  , something's in the wind


----------



## Devil_Star (11 December 2006)

History was just repeated. The momentum was up fiercely at the last 15 mins. But I still dun know what the deal is. I still hold both shares & CFDs on the stock. Hope it will turn out lovely shortly.


----------



## redandgreen (13 December 2006)

it's the Russians apparently that are interested in CSM according to today's AFR
Expect a bid B4 Xmas .......


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## noirua (13 December 2006)

Moving up steadily this morning and trading at $2.29 a few moments ago. Iron ore is one of the good sectors at the moment and CSM look to have ground to make up, with iron ore drilling results due soon.


----------



## Kipp (23 December 2006)

redandgreen said:
			
		

> it's the Russians apparently that are interested in CSM according to today's AFR
> Expect a bid B4 Xmas .......



Funny that the rumour didnt get the SP moving.  Looks like it should find support around $2.00.  Must be the only Nickel producer to be down for the year (though to be fair Ni is only a sliver of it's profits).  But even if the Russians aren't interested, CSM would have to a be a target right now, imho.


----------



## Devil_Star (23 December 2006)

Kipp said:
			
		

> Funny that the rumour didnt get the SP moving.  Looks like it should find support around $2.00.  Must be the only Nickel producer to be down for the year (though to be fair Ni is only a sliver of it's profits).  But even if the Russians aren't interested, CSM would have to a be a target right now, imho.




It is the cheap Mn that seriously offset the gain of a Ni. I'm getting bored at awaiting the disclosure of the deal with the Russian Group.


----------



## redandgreen (2 February 2007)

where are those Russians who said that they were coming......
maybe they've  decided to leave this  dog in the pound.....


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## wintermute (4 February 2007)

Rumours are just that! rumours!!  I don't think that there is any takeover at all, I'm more inclined to think that "discussions" are more likely a JV approach possibly with overseas companies in South Africa or South America, based on info that CSM announced about 10 months ago saying they'd been approached, but couldn't see anything for at least 12 months... again this is only speculation.... 

1/2 yearly results will be the acid test of whether or not CSM is turning around.

Tony.


----------



## redandgreen (6 February 2007)

wintermute said:
			
		

> Rumours are just that! rumours!!  I don't think that there is any takeover at all, I'm more inclined to think that "discussions" are more likely a JV approach possibly with overseas companies in South Africa or South America, based on info that CSM announced about 10 months ago saying they'd been approached, but couldn't see anything for at least 12 months... again this is only speculation....
> 
> 1/2 yearly results will be the acid test of whether or not CSM is turning around.
> 
> Tony.



agree... will wait for the results as u say this will be the acid test!
All else is just foolish. 
CSM has been a huge disappointment, I should have ended the relationship a year ago


----------



## redandgreen (7 February 2007)

on second thoughts, in this instance, my money is still backing the rumour... I guess time alone will tell.................


----------



## wintermute (7 February 2007)

Yeah the rumor resurfaced again yesterday in the SMH, but based on the less than stellar rise today I think it is getting a bit tired, after all it appears to have been this rumor that pulled the price up from around 1.70 last Oct, it is taking an awfully long time for these Russians to decide whether they are going to take over CSM or not   Seems to me that anyone wanting to take over CSM would not need to have months of discussions with CSM's management, as of August last year the biggest stakeholder in CSM had less than 6% of the company, IMO if someone wanted to take them over they would just do it!! 

Tony.


----------



## noirua (7 February 2007)

Keep the faith! As these matters, take as long as they take, and remember iron ore is King. I'm patiently holding on.


----------



## redandgreen (8 February 2007)

it's moving, love to know why


----------



## Kauri (23 February 2007)

redandgreen said:
			
		

> it's moving, love to know why





Cheeky buggers...A takeover based on the SP *last October*.... offering $2.28 per share.. about 1% premium on todays close..  led by Gilbertson of ex BHP fame.  



> Part of a Shareholder letter from CSM today...
> 
> Subject to the proposal being approved by shareholders, noteholders and the court (and subject to other conditions being satisfied), a new company will be created by way of 3 schemes of arrangement, between Consolidated Minerals and its shareholders, optionholders and noteholders.
> 
> ...


----------



## noirua (23 February 2007)

Kauri said:
			
		

> Cheeky buggers...A takeover based on the SP *last October*.... offering $2.28 per share.. about 1% premium on todays close..  led by Gilbertson of ex BHP fame.




This is going to take a bit of looking at, as the added value of a strong cash partner, sailing in, is evaluated. $2.28 looks miserable and a price nearer $2.70 seems fairer for a 60% interest.


----------



## wintermute (23 February 2007)

The fact that managment knew that they were turning around profit wise makes the $1.72 sp as the base look like a joke... the announcement today almost had an F You feel to it (with reference to the sp being up because of rumours) whilst this is I think largely true, I didn't buy based on rumour, I bought based on evidence in the quarterly reports of a turnaround starting!! Could be interesting to see how shareholders react, when asked to vote!

Tony.


----------



## hubisan (24 February 2007)

*Re: CSM - Shareholders must vote NO*

I can't believe that Consmin board recommends to shareholders 
1/ to accept to become minority holders of larger controlling interests !!
2/ to sell at a price in the lowest range of several years of quotation
3/ to ignore the future value of nickel operations. 

I will vote NO and I recommend that shareholders vote NO to this deal.


Hubisan


----------



## redandgreen (24 February 2007)

*Re: CSM - Shareholders must vote NO*



			
				hubisan said:
			
		

> I can't believe that Consmin board recommends to shareholders
> 1/ to accept to become minority holders of larger controlling interests !!
> 2/ to sell at a price in the lowest range of several years of quotation
> 3/ to ignore the future value of nickel operations.
> ...



Agree wholeheartedly, my vote is definitely NO, lets hope some fundies are on our side.


----------



## Kauri (24 February 2007)

They pick up 60% of CSM on a valuation based on the SP 4 months back...
     What do they bring to the table.... mmmm..Gilbertson of course.. 
     Best of luck to CSM, by the way there is already a $5 million break fee penalty!!!





> *SMH Dec 17 2003*
> Brian Gilbertson, the keen cyclist and former BHP Billion chief, has marked his return to public company life by selling £3.6 million worth of shares he was given to chair Indian copper concern Vedanta the day it listed.
> 
> At this early stage, the South African's timing could not have been better. While Vedanta shares have sunk to £3.58 since joining the ranks of the London Stock Exchange last week, Mr Gilbertson managed to sell 903,961 shares at the £3.90 issue price.






> *The Age..May 23 2003*
> The rash of multimillion-dollar payouts to executives came into sharp focus yesterday when BHP Billiton finally settled on a departure package for former chief executive Brian Gilbertson.
> 
> South African-born Mr Gilbertson, 59, will receive about $12.4 million in payments and shares related directly to six months as chief executive, plus a pension for life of $1.5 million a year for 32 years of service with the group and its predecessors.
> ...


----------



## hubisan (24 February 2007)

Everything  signals this offer as an inacceptable manipulation at undervalued price

the past track of the newcomers from South Africa connection (see post bove)
the price
the purchase of 60%
the threat of 5 M$ charge is our manipulation to get small shareholders afraid

The recommandation of this deal by Rod Baxter is not tolerable.
If he agrees that shareholder should giveup to such a bad deal,  his legacy at consmin is over. Shareholders should present a resolution to fire him.
And then we would see who is the boss at consmin.

I am a Fench investor.
Can somebody tell me 

1/ if there are other message boards with large audience in Australia
2/ what is the controlling situation at consmin exactly right now

I will also look at it but any help welcome

Hubisan


----------



## hubisan (24 February 2007)

*Re: CSM - Consolidated Minerals : typo error correction*

Oups ther is a type error in my post above: Please read :
"the threat of 5 M$ charge is a manipulation to get small shareholders afraid."

Hubisan


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## Rimtalay (1 March 2007)

A lot of opposition has already started against the Consolidated Minerals takeover by Pallinghurst Resources.
If you check this website http://www.usail2.com/consolidated_takeover.htm
you will  to see the Consolidated Minerals takeover Vote NO website.
If you tell all other sharetraders to visit this site and send their feedback it will be a way of standing up for the rights of shareholders and also to support the people who set up this website.
Lots of interesting info, and links to Asian metals trading websites
Cheers


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## noirua (1 March 2007)

My view seems to run contrary to others on this proposed tie up of Pallinghurst resources, AMCI and Consolidated Minerals.

Pallinghurst is headed up by Mr Brian Gilbertson, a former CEO of BHP Billiton and I understand and agree to the favourable arguments put forward.

I will accept the offer and consider buying shares in the new set-up.


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## Rimtalay (1 March 2007)

I note from the Consolidated Minerals takeover website 
http://www.usail2.com/consolidated_takeover.htm they are not against having Mr Brian Gilbertson onboard, they just say the price of $2.28 is unacceptable. When you read that they have $150 million stake in other companies, $10 billion of nickel in the ground, $3 billion of manganese and $470 million in Chrome Ore then the $2.28/share offer is for idiots, who don't know any better. The website is just trying to make people aware and making the CEO and Board more accountable. For example they said "in the Company's Half Year Results June 06,
http://www.usail2.com/consolidated_takeover_incorrect_statements.htm
"The Company believes that through providing forecasts of production and costs, along with regular reporting on commodity prices attained by the business, analysts and investors will be better positioned to have an informed view of the profit outlook."  In fact the Company has made no statement (to my knowledge) referring to prices attained by the Company during the past six months."

Also did you see on the website today that India has introduced a US$44 tax/ton on chrome ore from 1st April
http://www.usail2.com/consolidated_takeover_chromite.htm

From the www.miningnews.net today 1st March 07
Kiernan added that Gilbertson could bring some strong direction to the company, which he said had moved sideways since his departure.

"To be quite brutal, the new management and the board have basically done nothing with ConsMin and those assets. They've basically just sat on the nest and warmed the eggs. And in some areas they've allowed the eggs to get cracked," Kiernan said.

I agree with the website $2/share and the 2 for 5 share offer. And what about dividends for the next half year , I bet with US$20/lb nickel they'll be making money, shouldn't existing shareholders get that. Not Gilbertson get 60% of the money. Don't be a fool!
They said they haven't any YES votes yet, so if you want to be the lone YES voter then I suggest you vote.
http://www.usail2.com/consolidated_takeover_feedback.htm


----------



## Rimtalay (2 March 2007)

*CSM - Chrome ore hots up.*

This chrome ore market is about to really hot up. Consolidated Minerals is the only producer in Australia producing 2 1/2% of the worlds supply. With the announcement from India yesterday about the US$44/ton tax and now from South Africa the worlds largest supplier of Chrome ore comes this announcement from South Africa. My guess this going to add a minimum of US$44/ton to the price in China within days. But potentially far more due to the South African announcement. Chrome ore is already up to US$245/ton, if it goes to US$300/ton ( which it will), CSM will be making $60million/pa. on current production and I'm talking PROFIT. Consolidated Minerals is the only producer in Australia and is about to get a huge boost.

http://www.miningweekly.co.za/?show=102934



> SA to ban raw chromite exports - Deputy President
> 
> South Africa's Department of Minerals and Energy planned to gazette new legislation preventing South African chrome miners from exporting unbeneficiated chrome ore, deputy President Phumzile Mlambo-Ngcuka said on Thursday.
> 
> ...


----------



## Rimtalay (4 March 2007)

All CSM shareholders, there is a website where we can show our disgust with the CSM management. We need to speak up and be heard. $2.28/share is a rip off. If we all tell the Management the offer is unacceptable you can be sure they'll up the offer. If not bad luck, Gilbertson can go somewhere else and the Management can get back to doing what they are paid for.
Register your comments at http://www.usail2.com/consolidated_takeover.htm


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## noirua (4 March 2007)

Watch the CSM share price to see if there is much hope of a counterbid. In the current market and the problems that CSM have to overcome, "The Price is Right" as Bruce Forsythe would say.


----------



## noirua (4 March 2007)

I should add that Consolidated Minerals in the UK (CNM) has every poster against the offer.  It does seem that this offer is just a passing shot over the boughs and may well be increased by Gilbertson and Co.


----------



## Rimtalay (4 March 2007)

All CSM shareholders should email the Managing Director Mr Rod Baxter and tell him what they think (Politely)   rbaxter@consminerals.com.au
This the best way he'll get the message that we all want more money, minimum $2/share plus 2 for 5 share option.
Tell him today,    tomorrow   and the day after, he'll get sick of it.


----------



## Rimtalay (5 March 2007)

*CSM - MANGANESE - GILBERTSON*

GILBERTSON LOOKS AT MANGANESE
PERTH's Consolidated Minerals is believed to be already casting an eye over assets which have been linked previously to former BHP Billiton chief executive Brian Gilbertson and his close business associates.

Mr Gilbertson last month announced his return to the Australian market through a partial private equity tilt at ConsMin aiming to transform it into a diversified miner on the scale of Oxiana, or even Xstrata, through a series of acquisitions.

Former ConsMin managing director Michael Kiernan, who left the company last year, told the Herald some of his former employees had informed him Mr Gilbertson was very keen on expanding the miner's manganese business.

Mr Gilbertson and his business associates such as London investment banker Roddie Fleming and Russian oligarch Viktor Vekselberg have made several moves in the South African manganese sector in the last few years.

Through his holding company Renova, Mr Vekselberg, the chairman of Russian aluminium producer Sual, obtained 49 per cent of the Kalahari manganese project. Mr Fleming originally held part of that stake but is believed to have sold out. The majority is owned by a black economic empowerment partner.

The Kalahari project is in the same region as Samancor Manganese, which is 60 per cent owned by BHP Billiton and 40 per cent by Anglo American. BHP picked up the project through its merger with Billiton, which was headed by Mr Gilbertson. Mr Vekselberg reportedly attempted to buy Anglo's stake in Samancor in 2005 but was knocked back.

Mr Gilbertson last month told Australian media Mr Vekselberg "might" be an investor in ConsMin via his private equity group and added he held an interest in manganese assets in South Africa.

And Mr Kiernan noted Mr Gilbertson and the proposed new ConsMin strategy head, Arne Frandsen, had a history of involvement with black economic empowerment companies which made a deal with one another possible.

Mr Kiernan added Mr Gilbertson might look at alloy and smelting businesses to make the company a fully integrated supplier and more effective competitor against its larger manganese rivals. Other options included expanding ConsMin's WA nickel business through the purchase of Independence Group, Mincor or Sally Malay. "Brian is a great consolidator," Mr Kiernan said.

Some other assets which have previously been linked to Mr Gilbertson have recently resurfaced. Mr Fleming, the nephew of deceased James Bond author Ian Fleming and the head of UK investment bank Fleming Family and Partners, is looking to float his family's Mozambique tantulum assets in London. The same assets were supposed to be folded into Sual in 2003 but the deal fell over.

However, John Meyer, an analyst with Numis Securities in London, said: "The Flemings are always looking to sell overvalued assets into the market."


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## Rimtalay (6 March 2007)

*CSM email rbaxter@consminerals.com.au*

All CSM shareholders - the vote NO is hotting up. Email the Managing Director Mr Rod Baxter and tell him what you think. rbaxter@consminerals.com.au
Check on the website Consolidated Minerals takeover Vote No
Post your info, help to make a difference. Vote NO


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## noirua (6 March 2007)

Investor Roadshow Presentation:  http://www.asx.com.au/asxpdf/20070305/pdf/3119jythd85bz9.pdf


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## noirua (6 March 2007)

I've added to my holding in CSM. The cash part of the bid will be an excellent back drop if markets slide further. Always the chance of an increased offer, even though this partnership looks good and should see the company accellerate from troubled waters.


----------



## Rimtalay (6 March 2007)

I wouldn't count on the deal as it stands getting passed. There is a lot of opposition to the takeover, and the Management hold very few shares, I guess that's why they recommend the deal, they have nothing to lose. Though they don't realise it yet they may even get ousted as many shareholders are already talking about giving them  the sack. But who knows they may come to their senses and offer shareholders a decent price. You'll be able to thank us, if that's the case.


----------



## Rimtalay (6 March 2007)

CHROME ORE MARKET TO HOT UP 
http://www.usail2.com/consolidated_takeover_updates.htm  

Chromium Price Set To Soar
FN Arena News - March 06 2007 

By Greg Peel
One of the side effects of the great Chinese commodity consumption surge is that we've all become a little bit more familiar with the periodic table. Once familiar metals and minerals began to leap in price, wily investors were quickly out looking for those lesser-known elements that might be next on the list.
You won't read an awful lot about chromite – the ore from which we derive chromium coating for steel – despite the everyday familiarity of chrome. As it is not used a lot in basic construction, it boasts nowhere near the popularity of that other leading steel coating – nickel. Chrome surfaces are actually manufactured by placing a microfine coating of chromium over a nickel layer.
But chromium is nevertheless yet another element coveted by the Chinese in their economic surge, and now the subject of a lot of consternation from two of the world's major sources of chromite.
South Africa has 72% of the world's known chrome reserves, and is the world's number one producer of ferroalloys (of which ferrochromium is one) producing 41%. Beneficiated (processed) chrome is about ten times more valuable than unbeneficiated chrome, so there is a significant incentive to keep control of the beneficiation process when you own all the chromite. Apart from the price difference, the smelting industry is a good employer and that's a problem South Africa constantly faces.
Nevertheless, a company by the name of Kermas has upset the "local" chrome industry by directly exporting raw chromite to China and supposedly undermining the value of the industry in South Africa. Kermas bought Semancor Chrome last year from BHP Billiton (BHP) and Anglo American. Most peeved was Xstrata-Merafe which has lost 16% of its chromium market share due to direct exports.
In 2005, raw chromite exports to China from South Africa totalled 760kt. In 2006 this figure reached over a million tons and the trend has only been up.
So in response, the government is planning legislation to ban the export of raw chromite.
This move follows similar measures by India, another major chromite source, which is planning a US$45/t levy on the export of raw chromite for the same reasons. Most of India's chromite exports go to China.
As the developing world catches up the mature economies, the adjustments are often painful (and South Africa is counted amongst the developing nations, despite its mineral wealth). Having been raped and pillaged for generations, these countries are carefully balancing social costs against the free market, despite such moves being against the tide of globalisation. India, for example, has just clamped down on a newly opened futures exchange in the belief that speculation is pushing up prices.
While Xstrata-Merafe may be a major beneficiary of the South African initiative, CEO Steve Phiri told Mining Weekly Online that "our mineral resources belong to all the people of South Africa and by exporting raw chromite we are destroying jobs".
How long developing nations can hold out before the Chinese simply come in and offer huge incentives, as they have done throughout a lot of Africa recently, is a case in point. But what is no doubt a given is that the price of chromium will be forced up in the meantime.
Australian investors looking for exposure to chromite might care to take a look at Consolidated Minerals (CSM).


----------



## Rimtalay (6 March 2007)

As one shareholder said on the http://www.usail2.com/consolidated_takeover_opposition.htm 
"I reckon David Hicks is getting a better deal than ConsMin shareholders"


----------



## Rimtalay (10 March 2007)

A very different company


Pallinghurst Resources will buy 60% of CSM from existing shareholders. Pallinghurst is a private equity resource investor led by Brian Gilbertson of Billiton fame. The bid is $6.40 cash and two shares in the new CSM for every five shares, equivalent to $2.28 a share. The new company will be 60% Pallinghurst and 40% current shareholders. It's effectively a partial takeover, well timed and on the cheap. The deal is via scheme of arrangement. Shareholder, noteholder, foreign investment review board and court approval is needed. Directors, including the MD and Chairman, keep their jobs and unanimously support the offer. Gilbertson as well as Hans Mende and Arne Frandsen of AMCI join the board. 


Judging by the Sydney lunch this week, some brokers and analysts are unhappy. The premium is modest, 14% on the six month average pre-speculation price. While some are disappointed with the price, owning 40% of new CSM will share upside. Angst is linked to disappointment with previous management, falling manganese prices and the recent poor share price performance. South African management in what is "Australia's next mid tier champion" irks some. Those issues will fade after the first one or two deals. Expect the first acquisitions to be high quality and well considered. Management is determined to escape legacy issues and re-establish credibility. 


The plan is to recreate the Billiton and Xstrata experience. Aggressive growth through acquisitions backed by a supportive major investor. For Xstrata it was Glencore. CSM will have Pallinghurst. Pallinghurst has US$1bn and is backed by successful private coal company AMCI. CSM's acquisitions have been a highlight. The company is already looking at potential targets. Management is finally excited after a tough year. With $320m in the game, Pallinghurst should be sufficiently motivated. 


For CSM all hinges on successful deal making. We acknowledge control has potentially passed to Pallinghurst with a small premium and that acquisition growth is more difficult in a falling commodity environment and boomy resource market conditions. That said, we see more upside than down. This may be the start of multi year growth. Operations have stabilised and key markets are improving. We upgrade from Hold to Speculative Buy. CSM can be comfortably bought up to the bid price of $2.28 and potentially beyond. Our valuation rises 16% to $2.50 after investment gains, profit upgrades and adding a 25c premium for exploration, development and acquisition potential. Long term assumptions are unchanged. Asset quality reservations are likely be overshadowed by acquisitions. 


1H07 NPAT was double our forecast, mainly due to creditable cost control. Sales revenue rose 8% to $119.2m compared to 2H06 with stronger manganese and nickel contributions. Manganese production was up 8%, nickel steady and chromite down 4%. Net operating cashflow more than doubled to $10.8m and the dividend was reinstated. We upgrade our adjusted FY07 NPAT forecast by 27% to $35.0m. Assumptions for 2H07 include a US$2.38/dmtu manganese price and US$15.25/lb nickel. Similarly, FY08 increases 6% to $74.7m based on US$2.50/dmtu manganese and US$11.00/lb nickel. 


1H07 RESULT 
 1H06 
 2H06 
 1H07 
 %CHG* 
 %CHG^ 

Sales Revenue ($m) 
 103.8 
 110.1 
 119.2 
 +14.9 
 +8.3 

EBITDA ($m) 
 21.3 
 21.9 
 30.5 
 +43.1 
 +39.5 

EBIT ($m) 
 7.6 
 12.4 
 17.1 
 +123.7 
 +38.1 

Pre-tax Profit ($m) 
 4.3 
 10.3 
 12.6 
 +191.0 
 +22.2 

Adjusted NPAT ($m) 
 3.2 
 12.8 
 8.3 
 +162.3 
 -35.1 

Headline NPAT ($m) 
 3.2 
 -9.7 
 10.2 
 +222.2 
 n/a 

Adjusted EPS (cps) 
 1.4 
 5.7 
 3.7 
 +153.9 
 -36.0 

Net Op. CF ($m) 
 4.8 
 4.2 
 10.8 
 +124.1 
 +154.5 

DPS (c) 
 3.0 
 0.0 
 1.75 
 -41.7 
 n/a 

Net Debt ($m) 
 57.4 
 94.2 
 105.4 
 +83.7 
 +11.9 

EBITDA Margin (%) 
 20.5% 
 19.9% 
 25.6% 
 +24.6 
 +28.8


----------



## Rimtalay (10 March 2007)

10th March 07 Vote NO website http://www.usail2.com/consolidated_takeover_updates.htm

We're not the only ones who think that this takeover of Consolidated Minerals by Pallinghurst Resources STINKS.

“investor led by Brian Gilbertson of Billiton fame. The bid is $6.40 cash and two shares in the new CSM for every five shares, equivalent to $2.28 a share. The new company will be 60% Pallinghurst and 40% current shareholders. It’s effectively a partial takeover, well timed and on the cheap. “
“Judging by the Sydney lunch this week, some brokers and analysts are unhappy. The premium is modest, 14% on the six month average pre-speculation price. While some are disappointed with the price, owning 40% of newCSM will share upside. Angst is linked to disappointment with previous management, falling manganese prices and the recent poor share price performance. South African management in what is “Australia’s next mid tier champion” irks some. Those issues will fade after the first one or two deals. Expect the first acquisitions to be high quality and well considered. Management is determined to escape legacy issues and re-establish credibility.”





This is from Huntley's your weekly money. Pity they can't get their facts right. What it says in my letter from Consolidated Minerals is " an attractive cash and script package comprising
A $1.38 cash for each Consolidated Minerals share they hold. and 
2 shares in the new company for every 5 Consolidated Minerals shares they hold." 
That's what my letter says, if it said $6.40/ share, we'd all say YES PLEASE.( maybe it's just some fancy way that Huntley's do their arithmetic, but I've calculated it every way, up, down and inside out but I can't get $6.40, or do they mean $1.38X5 = $6.90) (EVEN WORSE THAN THE OFFER -NO THANK YOU)
Sounds like some brokers and analysts are unhappy, what about all us shareholders, we aren't exactly jumping for joy. Huntley's talk about upside, what 40% share in the upside, what upside, we still have the same chickens in the chook house. Maybe the rooster (Gilbertson) will be crowing at 4am to get those lazy chooks off the eggs ( before they crack them even more) and out of the warm henhouse to scratch for some more scraps.
I reckon better to put a bomb under their butts and blow them out of the chook house permanently. Maybe that is what is needed, obviously the chooks don't give a damn about all us baby chicks !!!


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## noirua (10 March 2007)

Hi, The new company will be owned just 40% by todays CSM shareholders. You are forgetting we get A$1.38 cash as well and anyone who likes the new set-up can buy more shares with their money.

Yes, you can argue for more cash, fair enough, but, it is important not to scupper the deal.


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## Rimtalay (10 March 2007)

Scuttle the deal, you bet !!! That is the intention if shareholders don't get a fair deal, don't listen to the hype. Remember shareholders will only own 40%, there is no way we can vote down an deal etc after the takeover takes place. There is more behind this deal than most people realise. 
zen_machine at HotCopper has done some investigation , I will post some of his info, I'm sure he won't mind, as he is in the Vote NO camp

"Gilbertson says he will build up the company. 
But this not something he has done in the past.
It is all smoke and mirrors and means of getting the company cheap.

Just have a look this guy.... Arne Frandsen.
Arne Frandsen is going to be the director of strategy in the new CSM.

Gilbertson was a non-executive director in a black empowerment company called Incwala Resources which he helped to put together.
His side kick at the time was Arne Frandsen who was intalled as the executive director of the company.

Arne Frandsen promised to raise funds and expand the company.

BUT IN THE END NOTHING EVENTUATED!!!

Checkout this article
V
V
V

Frandsen quits Incwala Resources
David McKay & Allan Seccombe
Posted: Wed, 07 Jun 2006
[miningmx.com] -- INCWALA Resources CEO, Arne Frandsen, has resigned less than a year after taking up the position, an announcement that will be a blow to the empowerment outfit.


In an interview with Miningmx, Frandsen said he always planned to spend between one to two or three years at the helm of Incwala Resources. It was now logical to make way for a black CEO, he said.

"As a prominent BEE company, it is prudent that it is led by a historically disadvantaged South African," said Frandsen, who is a Denmark national. However, in terms of his contract with Incwala, he could be asked to serve a six month notice period. "That is entirely up for the board to decide," he said commenting on whether he would retain his post until the year-end.

Earlier in the day, Incwala issued a terse two line statement confirming Frandsen's retirement, and promising more details later. 

Tasked with building the empowerment firm's business, Frandsen took Incwala Resources into a memorandum of understanding with Mvelaphanda Holdings in December 2005 to buy its 22% stake in Mvelaphanda Resources (Mvela Resources).

However, the proposed transaction fell through about four months later after an independent committee, established by Mvela Resources, imposed a condition of first right of refusal on new projects, a term Incwala couldn't accept. 

It's thought that deputy chairperson Zanele Mavuso Mbatha may take over the CEO position on an interim basis.

Black investors own 52.8% of Incwala and Lonmin and the Industrial Development Corporation both each 23.6%. Incwala owns 18% of Lonplats, the world’s third largest primary platinum producer.

Frandsen is a banker and was appointed to Incwala having worked with Incwala's former chairman, Brian Gilbertson. It's thought that the failure to implement the Mvela Resources deal and the resignation of Gilbertson as chairman of Incwala helped isolate Frandsen. Gilbertson is a non-executive director of Incwala.

Raised expectations about consummating deals also placed extra pressure on Frandsen who was stylised in one media article as the 'Danish Viking'.

“There’s space for a real substantial fourth player in South Africa,” Frandsen said of Incwala in an interview with Miningmx dated July 20.

"It was as much a surprise to us as anyone," said James Wellsted, investor relations manager for Mvela Resources.

"What did he deliver? That was the problem," said another source. "He spoke too liberally about doing a deal a quarter and it just didn't happen," the source said. 
Free news alerts: click here to subscribeSaid Frandsen: "I don't measure my success on how much of the company's money I spent. At the top of the commodity cycle, equities we want to buy are very expensive. Sometimes there's more value in not doing deals." 

Frandsen helped broker SA Breweries when it bought US brewer Miller, the listing of Ashanti Goldfields in New York and the creation of Incwala itself, the latter while client CEO at JP Morgan (Europe).

"Incwala started as a company worth $400m and now it's worth in excess of $1bn," said Frandsen. "That's partly due to the platinum price but it's wholly prudent that I go now."

continue next post


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## Rimtalay (10 March 2007)

Continued
"Here is another shady character who seems to be in cahoots with Gilbertson.

Victor Vekselberg.

Vekselberg owns Sual. Sual has just combined with RUSAL to produce the biggest alminium producer in the world.
He also own Renova. Renova seems to a company in which Vekselberg uses to acquire raw materials like manganese which are used to produce aluminium.

In the SMH article Vekselberg and Renova may invest in CSM via Pallinghurst.

I would say this is what will happen.

PALLINGHURST WILL SELL csm'S MANGANESE BUSINESS TO RENOVA AND MAKE A NICE TIDY PROFIT FROM THE DEAL.

Just wait and see.

In the meantime just check out this article about Vekselberg and the Renova group.

Tell me if you don't smell something fishy.
v
v
v
v

Don't count your roubles 

Nic Dawes, Stefaans BrÃ¼mmer and Vicki Robinson 



08 September 2006 07:56 


Russian President Vladimir Putin was in South Africa this week for his first official visit with President Thabo Mbeki. (Photograph: David Harrison) 
The R7,2-billion in foreign direct investment promised by the Russian investment group Renova may not be quite what it seems, documents detailing the financial structure of the deal suggest.

The most prominent among the business people accompanying Russian President Vladimir Putin on his first visit to South Africa was Renova chairperson Victor Vekselberg, Russia’s third-richest man.

Putin on Tuesday described Renova’s plans to build a ferrochrome smelter at Coega, and to link it to manganese mines in the Kalahari, as a $1-billion (R7,2-billion) investment in South Africa. On Wednesday, Vekselberg told journalists that investment in the smelter and mining operations would reach $1-billion over five years. 

But documents and corroborating information obtained by the Mail & Guardian suggest that the total investment could be less than half that, and much of the money may come from local sources. 

According to a 2004 Renova document obtained by the M&G, the Russian company estimated the total project cost to be between $300- and $400-million. Renova’s website gives the same figure.

The document envisaged that only a part of this would be Renova’s own money, saying: “Once a bankable feasibility study shall have been prepared, Renova shall undertake to arrange financing for subsequent stages of implementation … using all available opportunities and connections with major financing companies.”

In a document submitted to government last year, Renova committed itself to providing up to $50-million (R350-million) of project costs ”” again, until a “bankable feasibilty study” is completed. Chief among these initial costs is an estimated R276-million in prospecting expenses. This document is silent on the smelter.

The only mention of a $1-billion figure is in the 2004 document. It says that the “estimated … market value” would be $500-million to $1-billion. This is a measure, not of the investment needed to get the project up and running, but of its value once that has been achieved.

It appears that a locally based consulting firm, Bateman, may be doing much of the fundraising legwork. According to the Russia Journal, which has published a series of articles questioning the plausibility of Renova’s investment promises, Bateman has confirmed in a statement that it is helping Renova to raise the funds. “Cooperation with Bateman on this aspect will allow Renova to exploit financing opportunities for joint projects, including ‘Manganese of Kalahari’,” the company said.

Last November Bateman confirmed the agreement with Renova: “As Bateman is not only a process engineering company, but also experienced in structuring financing packages for global projects of all sizes, the [memorandum of understanding] will allow Renova to exploit financing opportunities for joint projects.”

In short, there is no guarantee that more than $50-million will flow from Russia into South Africa. The balance of the required investment, which could be anywhere between $350-million and $950-million, would have to come from local and international financial institutions, or a stock market listing.

How that would affect the 51% BEE shareholding in United Manganese of Kalahari, the company through which Renova participates in the manganese project, is not clear. But it would almost certainly dilute it.

According to Business Day Vekselberg and Russian Natural Resources Minister Yuri Trutnev also hinted that Renova subsidiary Sual, headed by South African Brian Gilbertson, and rival firm Rusal were interested in the stalled $2,7-billion aluminium smelter project at Coega.

The two firms are currently the subject of intense speculation over a possible merger, which, according to Russia watchers, may or may not be in the works, and may or may not have Kremlin approval. The smelter, seen as the anchor tenant for the Coega Industrial Development Zone, has been on hold for several years. Pechiney, the company originally expected to build it, dithered over a final decision and it has since been taken over by Alcan. 

Vekselberg, who serves on President Thabo Mbeki’s international investment council, is among the Russian oligarchs who have managed to stay on the right side of the Kremlin. Members of the Russian media travelling with Putin pointed out that unlike other business leaders in the delegation, who were greeted with a perfunctory nod, he was granted a brief informal chat with the Russian leader and Mbeki.

Speaking at a press conference on Tuesday, Putin told journalists that trade and investment between Russia and South Africa ”” currently a miniscule R1-billion per year ”” had lagged behind the closeness of political ties between the two countries.

Certainly it was political business, from Coega to nuclear collaboration, that was at the forefront of Putin’s visit.

South Africa has agreed to source fuel for the Koeberg reactor from Russia until 2010. Hitherto, it has come from France. Further nuclear cooperation is also on the cards as Public Enterprises Minister Alec Erwin seeks to accelerate development in the local nuclear industry.

Public enterprises spokesperson Gaynor Kast said no alternative to the Alcan plant was currently being considered. “Renova aretalking about manganese smelters,” she said. 

Continued next post


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## Rimtalay (10 March 2007)

contnued
"lets look at CSM's saleable assets.

It has a profitable chromite mine.
It has a profitable manganese business.
It has a profitable nickle business.

It also has 32% Jabiru and the promising Jaguar project.


Pallinghurst is a private equity company Ok.

So how do these companies work?

well for one thing they look for diversified companies that have valuable assets that are undervalued by the company.

They then in theory build up the assets and sell em off.
OK
Sometimes however they don't build up the assets at all, they just sell em off.

Now what do think Gilbertson will do?


Gilbertson is saying he will add value to these businesses. In particular he is talking about doing deals and taking over managanese assets in South Africia.
He and Baxter are making a big thing of this at the moment.
He is saying sell me your company cheap and I will make it worth a fortune.

BUT WILL HE?????????????????????

Will he add value to the company?

You realise, if we give him our company he will get a 60% controlling stake which means he can do what he likes with the company.

He can completely disregard the needs of shareholders, if he wants to.

My question is this........

HOW DO WE KNOW, GILBERTSON WILL DO NOTHING TO GROW THE COMPANY AND JUST SELL IT OFF?????

the big question then is will Gilbertson add value to CSM businesses?

He says Arne Frandsen is some sort of great strategist who will acquire companies left right and center.

Well the fact is, his experience at Incwala Resources indicates he won't.

Baxter says Victor Vekselberg will invest money into expanding the company.

Well that is not true.

His experience in South Africia indicates that he is not interested in putting money into businesses and growing them.
Just acquiring them and taking what he can get out of them.

This is asset stripping operation just wait and see.

Unless Gilbertsen increases his takeover offer say to $2 and 2 for five shares, just tell him to forget it.

VOTE "NO" TO THE TAKEOVER.  "

Good to see some shareholders who can see through this deal - VOTE NO


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## Rimtalay (11 March 2007)

http://www.smh.com.au/news/cbd/rex-pays-off-for-expollie/2007/03/05/1172943357854.html 

Gilbo accused

Brian Gilbertson might not have everything his own way in his private equity backed tilt at Perth's Consolidated Minerals.


Having run foul of everyone in recent years from Russian oligarchs to being ousted by blue-blood chairmen, this time the former BHP Billiton boss faces a shareholder revolt from the smaller end of town.
A website called "Consolidated Minerals takeover VOTE NO" run by small individual shareholders has sprung up, encouraging shareholders to let the company know what it thinks of Gilbo's offer.
"Vote No - as shareholders of Consolidated Minerals we are being ripped off and treated as fools," the website says.
"Yes, it would be good to have Brian Gilbertson's expertise on board as a shareholder but … he is stealing the company from us. The only way for us to get fair treatment is to tell them. Vote no!"
They don't have dissent like that in Russia.


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## kerosam (12 March 2007)

for the chartist (and i am definitely not), judging from the ASX's graph, looks like its been on a upward trend for a while. and  been observing that it is moving north slowly...


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## Rimtalay (13 March 2007)

The post earlier from zen_machine on ( www.hotcopper.com.au) is right on the mark, read this story from www.minesite.com, Gilbo and his friend Victor with the SA manganese

MINESITE
March 12, 2007

Consolidated Minerals Confuses Its Own London Broker


By Our Man In Oz



Jump aboard the Gilbertson Express, or stand aside until the speed, direction and ability of the crew can be better tested. That’s the question confronting shareholders in Consolidated Minerals, a medium-sized Australian producer of manganese, chromite and nickel which has a strong London-following but which has become the latest tool of the multi-talented South African businessman, Brian Gilbertson. The announcement this morning that Numis Securities has decided to step aside as London broker to the company with immediate effect says a lot about the uncertainties being expressed by investors about this deal which seems to be more about Mr Gilbertson trying to put value into a South African manganese project for a Russian friend of his than coming up with a value adding deal for Consolidated Minerals. Numis Securities has long been involved with Consolidated Minerals and would have thought hard before making such a move. The directors of the company say they are talking to a possible replacement, but there are unlikely to be many eminent brokers in the queue.

Brian Gilbertson
If the people promoting the deal deliver on their promises ConsMin is set for a new life as a business with the potential to rival bigger miners. The copper and gold miner Oxiana is occasionally being whispered in the same breath as ConsMin, as is the even bigger Xstrata. But, while the potential seems to be there for a period of growth there are obviously nagging doubts about the way the deal is being packaged, and whether South Africa is really such a terrific place to commit part of your capital. As far as Minesite is concerned it comes quite high on the political risk list. 

Nowhere are these doubts easier to measure than on the Australian Stock Exchange. Since Gilbertson, a man who once ran Billiton, then BHP Billiton, then the Indian miner, Vedanta, and now the Russian aluminium producer, Sual, launched his complex plan to restructure ConsMin the share price of the Australian stock has barely moved. ConsMin directors, who are supporting the deal, say it values each share in their company at A$2.28. But, since the day the scheme of arrangement was first aired, February 23, ConsMin has “rushed” all the way from A$2.20, up to A$2.44, and then back down to A$2.30 – scarcely a ringing endorsement by the market. And roughly the same performance has been seen in London sp perhaps the Gilbertson magic is wearing a bit thin. 

A series of problems are confronting everyone involved. The deal seems to be (a) unnecessarily complicated, (b) appears to offer minimal financial incentive to accept, and (c) involves the injection of a smart new management team which has great ambition, but is yet to reveal precisely what it is it proposes to do with ConsMin. And then there is Gilbertson himself, a man of undoubted talent, but who rarely seems to stay in the one place for very long. 

What’s happened so far is that ConsMin suffered a “man overboard” problem less than two years ago when it’s charismatic chief executive, Michael Kiernan, fell out with some young fund managers and went off to build a gold business. The people left in Kiernan’s wake have not inspired investors, and ConsMin, from being a market favourite, has limped into relative obscurity despite having some modestly attractive assets. Meanwhile, somewhere in Moscow, London, or Johannesburg, a plan was hatched to give ConsMin a shot in the arm, led by Gilbertson who formed a private equity business called Pallinghurst Resources. 

The proposal is to create a new business which will be 60 per cent owned by Pallinghurst and its associate, the U.S. coal miner, AMCI, and 40 per cent by existing ConsMin shareholders. ConsMin chairman, and former BHP executive, Dick Carter, said in a letter to shareholders that ConsMin shareholders would “receive an attractive cash offer and scrip package” comprising A$1.38 cash for each ConsMin share and two shares in the new company for every ConsMin share they currently hold. Carter went on: “This values your Consolidated Minerals shares at A$2.28, representing a 32.6 per cent premium to the ConsMin share price of A$1.72 (being the price prior to the takeover speculation in October, 2006”. 

It is at this point that the eyes of outside observers start to glaze over somewhat. Comparing a bid this year with a share price last year is a bit of a stretch, especially as ConsMin back in October hosed down any takeover speculation. Then there is the “what next” step, which is where a leap of faith is required because no details of what Pallinghurst and friends brings to ConsMin has been released. Rumoured deals include the possible purchase of a manganese project in South Africa owned by Russian Oligarch, Viktor Vekselberg, or perhaps other South African assets are on the radar screen. Manganese is said to be a favoured target, and South Africa the country of choice. 

Carter said the deal would lead to a company with greater stability and security of earnings, accelerate expansion of nickel production, focus on delivering new projects and take advantage of “strategic growth opportunities in the manganese ferroalloys business globally and in new commodities.” But, precisely what those deals are will have to wait as ConsMin proceeds through a tortuous scheme of arrangement. Documents are due to be mailed out next month, with a vote taken of shareholders in May – making ConsMin today very much a work in progress. In the meantime it will be interesting to hear feedback from the roadshow proposed for London.


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## Rimtalay (18 March 2007)

*CSM - Pricewaterhouse Coopers valuation*

The Consolidated Minerals website VOTE NO has a valuation by Pricewaterhouse Coopers done on the 12th May 06. Shows a preferred valuation of AUD $2.70 when nickel was only US$8/lb. It's now US$22/lb
http://www.usail2.com/price_waterhouse.htm
Vote No and tell the management


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## noirua (21 March 2007)

The "Investors Chronicle" UK edition, has advised investors to accept the offer for CSM. They consider that the new Management are more likely to send CSM in the right direction.


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## Rimtalay (21 March 2007)

Talk about upside, what 40% share in the upside, what upside, we still have the same chickens in the chook house. Maybe the rooster (Gilbertson) will be crowing at 4am to get those lazy chooks off the eggs ( before they crack them even more) and out of the warm henhouse to scratch for some more scraps.
I reckon better to put a bomb under their butts and blow them out of the chook house permanently. Maybe that is what is needed, obviously the chooks don't give a damn about all us baby chicks !!!


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## Rimtalay (21 March 2007)

I hardly think that the Investor Chronicle has done any indepth analysis to make the statement. They even value ConsMin at AUD$2.80 themselves.
Yes accept by all means but at it's proper valuation $3 -$4 /share not $2.28. That's for suckers.

"Consolidated Minerals, the Australian manganese and nickel miner, is to be taken over by former BHPBilliton boss Brian Gilbertson, along with AMCI, a large privately owned coal company. The deal values Consolidated at A$625m (£251m), or 92p a share, below broker Collins Stewart's 115p valuation. The Aim quote will be retained. 



A former tip of the year at 111p (7 Jan 2005), Consolidated has yet to deliver. *Perhaps* Mr Gilbertson can inject new vigour. Accept.  "


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## noirua (22 March 2007)

AMCI have recently added 19.2% of Felix Resources at $5.00 a share to their coffers. They seem to be interested in mopping up a lot of Aussie mines.


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## Rimtalay (23 March 2007)

I see on the Vote No website http://www.usail2.com/consolidated_takeover_updates.htm
Pricewaterhouse Coopers and ConsMin demand that all reference to the valuation of ConsMin be removed from the website. Good to see a CNM , UK shareholder helps out to post the info.
Management will go to any lengths to make sure shareholders are kept in the dark. 
Its about time that shareholders realise that their about to be well and truly "shafted"


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## noirua (23 March 2007)

Rimtalay said:
			
		

> I see on the Vote No website http://www.usail2.com/consolidated_takeover_updates.htm
> Pricewaterhouse Coopers and ConsMin demand that all reference to the valuation of ConsMin be removed from the website. Good to see a CNM , UK shareholder helps out to post the info.
> Management will go to any lengths to make sure shareholders are kept in the dark.
> Its about time that shareholders realise that their about to be well and truly "shafted"




I must say, that Consmin and Pricewaterhouse Cooper seem to be unusually interested in a website that most other companies would normally ignore, in this situation. Who put them up to it I wonder? As it appears to be an error on their part, as it seems to have stirred up far more interest in the "NO" website.


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## Rimtalay (25 March 2007)

Well it is easier to comply with the request than go to court and fight them. But they will find it very hard to stop the info from being posted on the internet, I already have offers from another 3 shareholders in other parts of the world who will post the info for the website to link to.
The management don't realise that by doing this, they have already raised the awareness of shareholders and others.
http://www.usail2.com/please_delete_page.htm
They want to shut me up, but there is a lot at stake, and I'm very determined to get a fair deal for shareholders. Don't forget to email the MD Mr Rod Baxter at rbaxter@consminerals.com.au and post on the bulletin board and have your say.
http://www.usail2.com/consolidated_takeover_opposition.htm


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## Rimtalay (25 March 2007)

Looks like the management won't get their way without a fight, I have just started getting support from large UK Institutional shareholders, who are not happy either.
They are contacting each other now, so we may have a chance to get a fair deal, otherwise it will fall over.
Emailing the MD Mr Baxter rbaxter@consminerals.com.au and his side kick Mr David Brook is the way to go dbrook@consminerals.com.au 
The more you email them the better. I do it every day.

Did you see the announcement Mr Richard Elman the CEO of the Noble Group has resigned as a Director effective immediately. WHY???
You want to WIN , you have to FIGHT.


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## Rimtalay (25 March 2007)

CONSOLIDATED MINERALS* 93p BUY target 117p - Rival takeover offer potential as Elman (Noble Metals) resigns from board.

Manganese ore prices appear to have moved beyond our expectations (see article below) 

+> It looks as if the prices published in the Metal Bulletin are some way behind what is being realised in China <+ 

The following price increase if applied to this year only adds US$10m of value to our NPV of the cash flows and equates to a 2p per share in our valuation. 

If the manganese ore price increase is applied on a long term basis then this adds $143m (29p/s) to our valuation. 

Sensitivity: a 20c/mtu price increase = $35m in NPV. A 20c/mtu increase = 7p/s 

Note also that Richard Elman, who runs Noble Metals, has resigned from the board. Noble Metals is the trading house which sells ConsMins’ ores into China.

Noble Metals might look to make a rival offer for Consolidated Minerals and this could be the reason for Elman’s resignation.

If manganese and chromite ore prices in China are so far ahead of the UK published Metal Bulletin prices then consolidated Minerals might look far better value than we have been able to calculate on previous market information.


“A Chinese ferro-alloy news letter states the following:

Manganese Ore Price Has Increased by 25% This Year Manganese Ore

It is reported that international price of manganese ore has increased by nearly 25% since the end of 2006. Price of high grade manganese ore (Mn 48-50%) has climbed from USD2.5-2.7/mtu FOB to USD3.1-3.3/mtu FOB. According to producers, price of spots to be delivered in April has exceeded USD3.3/mtu. 

A European major producer of manganese ore said that the price was around USD2.7/mtu half a year ago, and began to slightly inch up since September 2006. Entering December, supply of high grade manganese ore appeared to be tight, while demand has been increasingly powerful. It is reported that a major ore producer in Europe has even lifted up price to USD3.5/mtu recently.”


*Numis Securities is NOT a broker or advisor to Consolidated Minerals. 
Numis Securities does make a market in the shares in the UK.


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## markrmau (25 March 2007)

Rimtaly,

You wrote:

"*Numis Securities is NOT a broker or advisor to Consolidated Minerals.
Numis Securities does make a market in the shares in the UK.


Where did that come from? Numis _WAS_ the UK broker for CSM.

Are they advising an alternate bid for CSM? Could that be the reason for Numis's 'resignation'?

Or have I got my wires crossed?


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## Sainter (25 March 2007)

Funny that, eh? CSM's official line is that they'd outgrown Numis. Gimme a break. As far as I know, CSM has not found another UK broker yet. Why would they sack one broker if they didn't already have another lined up, especially at a time when they're trying to get a message out to their shareholders?


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## redandgreen (27 March 2007)

the rise in SP speaks volumes.....


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## Rimtalay (27 March 2007)

Rival ConsMin bid could be brewing: Numis  www.miningnews.net

Paul Garvey
Sunday, 25 March 2007

CONSOLIDATED Minerals' long-time trading ally Noble Metals may be considering a rival bid for the diversified miner, according to Numis Securities analyst John Meyer.



Brian Gilbertson (left) with ConsMin managing director Rod Baxter and chairman Dick Carter 


ConsMin's Woodie Woodie mine 


Last Friday, Noble's representative on the ConsMin board, Richard Elman, tendered his resignation from the board with immediate effect.

While ConsMin said the resignation was "due to increasing demands associated with his position as chief executive officer of Hong Kong-based Noble Group", Meyer said a potential bid from Noble for ConsMin could have been behind the resignation.

"Noble Metals might look to make a rival offer for Consolidated Minerals and this could be the reason for Elman's resignation," Meyer said in a note released over the weekend.

Noble has handled the trading of ConsMin's products into Asia for several years, and is ConsMin's largest individual shareholder with a 5.52% interest.

However, Elman was a member of the ConsMin board that said it had unanimously recommended the current takeover bid – in the absence of a better offer – launched by a private equity syndicate headed by former BHP Billiton chief Brian Gilbertson.

Gilbertson's Russian-backed group Pallinghurst Resources, together with private coal miner AMCI, are offering $1.38 cash per share plus two shares in the new ConsMin for every five currently held, in a bid that values the company at $2.28/share.

ConsMin operates the Woodie Woodie manganese mine, the Beta-Hunt nickel complex, plus the Coobina chromite project, all in Western Australia.

Numis also pointed to a newsletter report about recent improvements in the manganese price – in which manganese prices are reported to have increased 25% so far this year – as further supporting a higher price for ConsMin.

"It looks as if the prices published in the Metal Bulletin are some way behind what is being realised in China," Meyer said.

"If manganese and chromite prices in China are so far ahead of the UK-published Metal Bulletin prices, then Consolidated Minerals might look far better value than we have been able to calculate on previous market information."

Numis had up until recently been ConsMin's long-serving broker and advisor into London, but the group stood down from those posts shortly after the Pallinghurst offer was announced.


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## BlueBayDiver (27 March 2007)

Me thinks Rimtalay doth protest too much !!

Funny that comments used on the vote no website appear the same as Rimtalay's. Maybe some marketing attention being subversively drawn to the Usail2 website at the expense of real members of this chat site!!


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## Rimtalay (27 March 2007)

Hi BlueBayDiver, 
Haven't heard from you before. What are you some stooge from ConsMIn? I wouldn't be surprised. How many shares do you have in ConsMin? 
What a fantastic post, was it your first post eh?
How about something a little more constructive in future. 
If you're a stooge from ConsMIn, at least you can see, no one is happy with this deal.
Good to see you've been browsing the Vote No website.
If your a ConsMIn shareholder have you posted on the Vote no website yet? NO


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## Sainter (27 March 2007)

I, among others, am very grateful for Rimtalay's efforts in this area. I welcome his postings as they strive to reach CSM shareholders, in order for them to be more fully informed (unlike CSM and PwC's recent actions). Even on the day the bid was announced, it took but the back of an envelope and one minute to prove (and I mean prove) that this offer was a crap one for CSM shareholders. Rimtalay's efforts have provided a focus point for people to demonstrate their displeasure with this pitiful offer, and as a conduit for shareholders to better understand the true value of the company. 
Have another look around the NO website. Unless you're Rod Baxter or intellectually challenged, you would have to say the facts make a compelling case to vote NO.
Oh, and the proof? Look no further than Ni.
Keep up the great work Rimtalay


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## Rimtalay (28 March 2007)

Hi Sainter - Thanks for the kind words. If ConsMin management did their job, and made announcements to the Market, I wouldn't have to do their job for them.
Chrome ore is rocketing, I hope that ConsMin executives have time to look after shareholder interests  and try and improve  their negotiating skills with the Chinese. From what I hear they are bloody hopeless.

China Buys African, Turkish Chrome on India Tax Rise (Update1) 

By Helen Yuan

March 27 (Bloomberg) -- China, the world's biggest producer of ferroalloys, is turning to South Africa and Turkey for chrome ore after India imposed a tax on the mineral to curb shipments. 

Chinese steelmakers and traders are increasing purchases of chrome ore from those countries after costs from India increased, said Tu Kun, ferroalloy general manager of China Minmetals Corp., the nation's biggest importer of the commodity. 

India, which has less than 1 percent of the world's chromium deposits, supplies one third of China's imports of chrome ores. The South Asian nation imposed a 2,000 rupee ($44) a ton duty on overseas shipments of the commodity from March 1. Higher duties raised costs for Chinese buyers as the nation's economic growth of 10.7 percent last year boosted consumption. 

``Chrome ore demand is strong because of increased production capacity of stainless steel in China,'' Tu said at a conference in Hong Kong. 

China may boost stainless steel output by 37 percent to 7.35 million metric tons this year from 5.36 million tons in 2006, metal research firm Heinz H. Pariser said last week. Ferrochrome, a ferroalloy combining iron and chrome, can be used to produce stainless steel as a substitute for nickel. 

``The Indian government doesn't want to export any minerals,'' said Goutam Dutta, mineral exports head of Tata Steel Ltd., at the conference. Exporters are trying to pass on higher taxes to buyers. ``We will see how things settle.'' 

Import Surge 

China's chrome ore imports rose 40 percent to 4.32 million tons last year, including 1.34 million tons, or 31 percent, from India. About 18 percent were from Turkey and 17 percent from South Africa, according to customs data. 

``Chromium prices will remain high in the second quarter'' as Chinese demand keeps rising and exporters may impose more measures to curb shipments, Tu said. Prices could be more volatile in the third quarter as Chinese stainless steel producers may cut back production, he added. 

Minmetals plans to boost chrome ore imports by 67 percent to 1 million tons this year, according to Tu. 

To contact the reporters on this story: Helen Yuan in Hong Kong at hyuan@bloomberg.net ;


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## Rimtalay (28 March 2007)

ConsMin - manganese is also up more in China. Have management of ConsMin advised the market, no way, they want us all to believe that the only way forward is to accept their lousy deal.


Manganese surge continues
Chinese manganese prices have continued to surge so far this week on the back of the continued tight availability and soaring production costs caused by manganese carbonate and selenium dioxide, market players told Metal-Pages today. 

27-Mar-2007 
FeCr stays strong in China 
Manganese surge continues 
Chinese Ni imports and exports soar 
26-Mar-2007 
Chinese Mn alloys prices higher on supply shortages 
Chrome metal continues up


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## questionall_42 (28 March 2007)

Being a passive reader of this thread, I just want to say that Sainter is spot on with his/her comments about Rimtalay.  I, for one, fully appreciate the information that is being posted here. Thanks.


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## Rimtalay (28 March 2007)

*Consolidated Minerals: JP Morgan sees no reason to tender shares at current offer price*

JP Morgan sees no reason to tender its shares to the bid for Consolidated Minerals at its current price, according to Ian Henderson, a portfolio manager at JP Morgan. 
Brian Gilbertson’s Pallinghurst Resources private equity fund and AMCI have launched an offer for Consolidated Minerals, offering shareholders AUD 1.38 per share as well as two shares in the new company for every five held. Although changes in the ConsMins share price will translate into the value of the scrip portion of the offer, the bid has been criticised by some investors who claim that the cash component of the bid should be increased to as much as AUD 2 per share. JP Morgan, a minority shareholder in Consolidated Minerals, has now joined the ranks of investors who believe the offer price should be higher. 
“Where we stand is that we have not voted one way or the other. We note that the board has recommended the offer and that the market is seemingly disappointed that there is no premium,” Henderson said. 
“It is going quite cheap and the deal does seemingly look a bit opportunistic in light of low manganese prices, but that said maybe Brian Gilbertson and his colleagues can make a great success of it. 
“The stock is trading at a negative spread and we are not complete fools. We are not going to ignore the fact that in the open market you could get more for your shares – there would have to be a very special reason to do that and there doesn’t seem to be here,” he said.


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## Rimtalay (28 March 2007)

Did you know, ConsMin holding in JML is now at $152 million today.
What do you think  CSM shareholders, do you really think that $2.28/share makes sense? I think NOT.
Did you know that ConsMin holding in BC Iron (BCI) is worth $11.55 million?   
Do you still think your CSM shares are only worth a miserable $2.28/share?
Think again. 
Rememeber ConsMin has 200,000 tons of nickel in the ground at 1% nickel cut off grade worth $12 billion. YES $12 billion. 
Do you still think your CSM shares are worth $2.28/share?
I'd like to know what deal have management cut with Pallinghurst Resources to get us to sell at $2.28/share. Must be a BIG BONUS.
Are shareholders Stupid? I think No.
I hear that *"JP Morgan sees no reason to tender shares at current offer price, executive says"*
What do you think BlueBayDiver? Do you plan to sell all your shares for $2.28/share? Either you're Nuts or a ConsMIn stooge. Will you tells us?


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## Rimtalay (29 March 2007)

*BHP execs are bullish on metals prices*
By Tom Stundza 
Purchasing 
March 28, 2007

Top executives at mining giant BHP Billiton caution buyers that transaction prices of copper, nickel and other base metals will remain high for the next several decades as demand climbs from China,India and other Asian nations. 

BHP Billiton’s chief executive officer, Chip Goodyear, says he is “positive” that the development of China and India into world economic powers “is the reason for a multi-decade increase in commodity prices.” Speaking to the media while on business in Chile, the Australian mining exec says the three-year surge in nonferrous prices is a so-called super-cycle that shows no signs of abating.

Analysts are suggesting that a metals “super cycle'” will keep prices elevated as supplies lag behind demand. Diego Hernandez, president of BHP's base-metals unit, agrees: “We expect that this super cycle will continue for a while. We think that demand will continue to stay strong for many years.''


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## redandgreen (29 March 2007)

thanks Rimmy...agree with you totally.
My CSM shares (given all that has taken place over the last 6 months) are certainly worth a lot more than the highly dubious valuation of $2.28.


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## Rimtalay (29 March 2007)

Did you note that ConsMins stake in JML increased to $152 million yesterday, in fact JML is now valued at $478,855,829 market capitalization. Won't be long before they'll be able to do a scrip takeover of ConsMin, since they are now level pegging CSM on market capitalization.
Pity that *Mr Michael Kiernan *isn't still on the board, he would have snapped them up when JML was only 30 -40 cents. An opportunity lost.
One shareholder said on the Vote No website
"We should call a meeting and kick out the directors. Consolidated should break up like Coles by agreeing to sell Jabiru shareholding to Oxania at a decent premium so Oxania can launch a takeover of Jabiru, Mindy Mindy to Fortescue, float the rest of BC Iron, sell Vital Metals on the Market, sell YML back to its directors or on the market, and give the cash back to the shareholders. I'll go and buy some Oxania Shares so I can share in the Jabiru Story there,"
I think it makes a lot of sense.


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## Dutchy3 (29 March 2007)

CSM was a real watershed stock for me a few years ago ...

Although I don't expect the same type of compounding this time its a relatively safe LONG for me


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## Rimtalay (29 March 2007)

Hi Dutchy3
What's your take on ConsMin from the charts. I'm new at charts, but it looks like sellers are getting fewer and that buyers are pushing it higher, what do you think? 
ConsMin management won't get this deal passed at the present price. 

With Jabiru at $152 million  and other ConsMin investments at $25 million, it would be better to break the Company up and sell all the assets than accept $2.28/share


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## Dutchy3 (29 March 2007)

Hi Rim

Corp actions can always produce results that are unexpected ... in my experience the chart often tells the story ahead of the actual news ... CSM is a BUY for me ... with STOPS starting at 2.30 ...


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## Rimtalay (30 March 2007)

Good times are on a roll for ConsMin with manganese ore prices on the move. Should expect an announcement from ConsMin management in the next few days, as they have a legal obligation to keep the market informed. The increases in Chrome ore and managanese ore could result in a 1/2 year profit of $50+ million. ConsMin management will be liable if shareholders are not advised epecially when a takeover bid is being offered. All shareholders have  a right to know the present earnings situation of the Company.
I hope the Company stooge  - BlueBay Diver reads this and reports back to management, what do you reckon D.... The Company is now on notice publicly.

Chinese manganese metal prices surge; offers in wide range  

Hong Kong (Platts)--29Mar2007
Chinese-origin 99.7% manganese metal offer prices have continued to rise,
moving beyond $3,000/mt FOB China this week. Prices, however, are quoted in
a wide range at $3,000-3,500/mt FOB China in a thin market, local traders said
on Thursday. Prices were indicated at around $2,000-2,200/mt FOB China a week
ago. 
     One Hong Kong-based trader said: "Offer prices for manganese metal are
changing every day. I am now offering material at about $3,200/mt FOB China
but could not find buyers so far." The trader said prices for its raw material
carbonate manganese ore prices were rising, leading to firmer manganese metal
prices. "Manganese ore is rich in Hunan province of China but the area's
mining activity has been further restricted by the government due to the
heightened environmetal protection policy in China," he said. 
     Another trader said: "The highest offer price level I heard earlier this
week was at $3,500/mt FOB China. Prices are up but we can't find spot material
available so far. Chinese producers are holding back their material when
prices are going up." A third trader added: "Prices were up earlier this week
but we are now seeing some technical correction these past two days. Offer
prices are all over the place and moving in wide range due to market
speculation."


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## Rimtalay (30 March 2007)

THIS IS  FROM CONSMIN MANAGEMENT AND MY REPLY - YOU MAKE UP YOUR OWN MIND
*I quote from  ConsMin management*
“e) You refer to the Company holding 200,000 tons of contained nickel in the ground and incorrectly convert this into a revenue number. This is not a reserve and your calculation takes no account of geological or mining losses. The current resource at Kambalda is 78,560 Nickel tonnes, with reserves of 16,911 tonnes. We will be working hard over the next 12 months to convert further nickel "endowment" into resources and reserves.” 
*My response *
“Is that true? 
I say that Titan owned 130,000 tons of contained nickel in the ground. I have put the ASX listed document on website http://www.usail2.com/TITAN%20RESOURCES%20NICKEL.pdf "Widgiemooltha Exploration and Evaluation
The Company owns the nickel rights over 227km² of prospective and strategic tenements in the Widgiemooltha area (Figure 2) that form part of the 
world class Kambalda nickel province. Nickel resources within the Company’s tenements at Widgiemooltha total 130,000 tonnes of contained 
nickel metal at a 1% Ni cut off in eight separate deposits. An active exploration and evaluation program has been pursued over these tenements 
with a series of positive results being achieved." 
David, I have only added the figures in your own 2006 Concise Annual report. The figure of 123,000 tons is also in your report.( not the 130,000 claimed by Titan) 
I also thought that the Twin Decline was planned so that it could explore and access "an estimated potential nickel exploration target of 90,000 tons" 
but I did not include this because the "calculation takes no account of geological or mining losses" 
So I believe that 123,000 + 78,560 = 200,000+ tons. Is this correct? 
Maybe I should amend the in the ground figure to reflect the current price of nickel. 
ie AUD$12.2 billion. We don't want to mislead shareholders do we.”


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## noirua (30 March 2007)

Rimtalay said:


> Hi Dutchy3
> With Jabiru at $152 million  and other ConsMin investments at $25 million, it would be better to break the Company up and sell all the assets than accept $2.28/share





That's probably what AMCI plan to do and create a new company with the best assets remaining.


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## Rimtalay (2 April 2007)

Do you think ConsMin management plan to tell shareholders that Chrome ore is up in China??

China on chrome ore alert despite high imports in YTD
According to the recently released State Custom statistics, China imported nearly 853,000 tonnes of chrome ore in the first two months of this year, almost double the 438,000 tonnes seen in the same period last year. 


FERRO-ALLOYS Chrome Ore Price Kept High [2007-04-02] 
FERRO-ALLOYS China Buys African, Turkish Chrome on India Tax Rise [2007-04-02] 
FERRO-ALLOYS China Was Seriously Affected by Export Tax Imposed by India [2007-03-28] 
FERRO-ALLOYS China Buys African, Turkish Chrome on India Tax Rise [2007-03-28] 



Chromium metal price going to “the moon” ] 
Chromium metal prices might increase in Europe ] 
International Cr ore prices to jump up next week


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## Col Lector (2 April 2007)

Gidday Rimtalay....following on from your ponderings on Chromium......thought you may enjoy this too...



PLATTS: Chinese manganese metal prices surge; offers in wide range
Hong Kong (Platts) Chinese-origin 99.7% manganese metal offer prices have continued to rise, moving beyond $3,000/mt FOB China this week. Prices, however, are quoted in a wide range at $3,000-3,500/mt FOB China in a thin market, local traders said on Thursday. Prices were indicated at around $2,000-2,200/mt FOB China a week ago. One Hong Kong-based trader said: "Offer prices for manganese metal are changing every day. I am now offering material at about $3,200/mt FOB China but could not find buyers so far." The trader said prices for its raw material carbonate manganese ore prices were rising, leading to firmer manganese metal prices. "Manganese ore is rich in Hunan province of China but the area's mining activity has been further restricted by the government due to the heightened environmetal protection policy in China," he said. Another trader said: "The highest offer price level I heard earlier this week was at $3,500/mt FOB China. Prices are up but we can't find spot material available so far. Chinese producers are holding back their material when prices are going up." A third trader added: "Prices were up earlier this week but we are now seeing some technical correction these past two days. Offer prices are all over the place and moving in wide range due to market speculation."


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## Rimtalay (4 April 2007)

This is the latest research document from Numis Securities, ConsMins EX UK broker. Note the increases in manganese and chromite.

CONSOLIDATED MINERALS – 103p buy 126p (from 117p) Earnings takeoff on higher Manganese & Chromite ore prices
Manganese ore prices jump a further 20% to $3.10 – 3.30 / mtu
Further evidence is emerging of higher manganese ore and chromite ore prices in China
Manganese ore prices: have jumped to $3.10 - 3.30/mtu according to the Metal Bulletin this week from $2.50 – 2.70 / mtu last week. 
Analysts are likely to upgrade forecasts further as the market begins to appreciate the impact of the rise in manganese and chromite ore prices. 
Consolidated Minerals management should have been aware of the strength of the manganese and chromite ore markets in China in recent months. 
We believe that the Metal Bulletin published manganese ore price is beginning to catch up with domestic Chinese price levels which may have been at higher levels for some time. 
Steel demand: for raw materials continues to rise generating further demand for imports of manganese and chrome ores for local ferromanganese and ferrochrome production. 
Manganese ore: demand in China rose by 19% last year to 5.1mt representing nearly half total global consumption. Chinese steel production is forecast to grow by a further 
10% this year with month-on-month production growth of 20% for February. We expect a similar rise in manganese ore demand. 
Valuation : our valuation rises to US$622m for the group from US$564m as the value of the manganese business rises with increasing ore prices. Further valuation gains appear 
likely as the company works through its nickel hedge book and begins to realise more of the nickel price. We have yet to raise our valuation for the chromite business as we are
 awaiting confirmation of the new level for chromite prices in Europe and in China . We believe that Chromite ore prices in china may be around 80% higher than some transactions seen in South Africa .
Target price: we are raising our target price to 126p from 117p. This includes a 15% discount to our net present value calculation to account for the normal market which
 we expect companies to have against our forecast valuations.
New estimates
Year to Sales PBT EPS Tax DPS Div. Yield FCF Yield Net Cash P/E
June ($m) ($m) ( ¢) (%) ( ¢) (%) (%) ($m) (x)
2006A 188.0 17.6 5.9 26.2 3.0 1.5 3.5 18.4 34.7
2007F 235.2 68.4 22.4 26.2 11.2 5.5 11.3 55.0 9.1
2008F 290.5 93.5 31.1 26.2 15.6 7.6 16.2 77.8 6.5
2009F 314.4 115.4 31.6 26.2 15.7 7.7 15.7 75.1 6.4
Old estimates
Year to Sales PBT EPS Tax DPS Div. Yield FCF Yield Net Cash P/E
June ($m) ($m) ( ¢) (%) ( ¢) (%) (%) ($m) (x)
2006A 188.0 17.6 5.9 26.2 3.0 1.5 3.5 18.4 34.7
2007F 225.1 59.2 19.4 26.2 9.7 4.8 9.9 48.5 10.5
2008F 252.2 58.9 19.6 26.2 9.8 4.8 10.5 51.3 10.4
2009F 303.5 106.8 28.9 26.2 14.3 7.0 14.4 69.4 7.0
Numis Securities does not act as UK broker or advisor but does act as a market maker to Consolidated Minerals
ANALYSTS: JOHN MEYER 020 7260 1279 / MARC ELLIOTT 020 7260 1232 / SIMON TOYNE 020 7260 1330


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## noirua (4 April 2007)

Hi Rimtalay, From what I've read on boards all over the place you are having an affect that will make AMCI and Co increase their bid. I thought you had little chance at first, now you've got them on the ropes. Quite an achievement.


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## Dutchy3 (4 April 2007)

Nice confirming action today ... chart tells the story ... hold LONG


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## Rimtalay (5 April 2007)

The fight has only started. What ConsMin management never realised was what was happening in China, I know first hand. Manganese and Chrome ore are rocketing, ConsMin management can't keep a lid on that.

www.asianmetals.com
[4-4] Ferrochrome prices rocket universally 
[4-4] Chrome ore prices keep increasing in Turkey 
[4-4] Chrome ore price overtops RMB65/dmtu in China 
Chrome ore is fetching over RMB 65/dmtu. This equals US$8.40/dmtu or US $352.95 /ton for 42% chrome ore. Last  year ConsMin received US$160/ton or AUD$199/ton. Cash costs are AUD$124/ton. Using the same cash costs, and the latest chrome ore prices from China, this could result in $40 million dollars profit for the next 6 months. Yes, ConsMin management will say that I've forgotten to add in seafreight and commissions, but we can deduct those from the equation and it will still leave a tidy profit. Of course if the management told us how much they paid in fees to Noble Group and freight, we wouldn't have to speculate. But lets say AUD$30 million.


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## redandgreen (5 April 2007)

Rim
What do you think is a realistic valuation on CSM given their significant improving fortunes?


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## Rimtalay (5 April 2007)

A fair and reasonable price for Consmin is $3 to $3.20. If they got their act together and increased their nickel production, then $4. 
With the present management, who knows, they spend most of their time trying to sell a deal at a price no one will accept. They'd be better off trying to fast track nickel like MIncor.


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## Rimtalay (5 April 2007)

AT last ConsMin management has made a market update for the rising prices of chromite and manganese, but NOTE after the market has closed before a 4 day holiday. You know they do this deliberately, they worry that even a little bit of good news might excite the market and the share price will go even higher, thereby making their $2.28/share offer  look even sicker than it already is.



> Consolidated Minerals Limited 05 April 2007
> 
> ASX / Media Release
> 
> ...


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## noirua (5 April 2007)

I thought that CSM were protected on exchange rate movements, to some extent, with a 3 year rolling hedge programme; Set at 75%, 60% and 50%.


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## Sainter (5 April 2007)

And they downplayed it as much as they possibly could. I can't believe these guys would not have long term shipping contracts in place, so a 50% rise seems a bit steep to me. The CEO of ADY went on the other month about he had locked in low freight prices for all of this year. Why can't CSM do the same? Not sharp enough? Or are they having a wink and a nod with the shipping company-pay more now and get a discount once Gilbertson owns the majority? Or is that too much of a conspiracy theory?
I'm guessing the maths shouldn't be too hard to work out (if enough info has been supplied), but the 8-10% net increase doesn't sound right to me. Again, they're frugal on the info they offer. Shonky b@$tard$.


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## Rimtalay (6 April 2007)

Did you note how they put out the announcement after the market closed before a 4 day holiday. 
Yes the announcement is a load of waffle, I think that Baxter could teach the pollies a thing or two about gobbledygook, mumbo jumbo and drivel. I doubt whether he has given a straight answer in his life judging from that announcement.
They are desperately worried that any good news will push the share price higher, ending their deal.
Judging from the announcement it seems hard to believe that they are enjoying the good prices for manganese and chromite, they had better start to sharpen their pencils when they deal with the Chinese. 
Maybe we should get ARH's Dr Clive Palmer to go in to bat for them.


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## Rimtalay (8 April 2007)

Trying to understand the Operations & Market Update, I have worked out the profit on maganese so far. Buried in the bull is good news, by my calculations using their figures will result in a profit of $38,713,600 on manganese for the full year. 
Using the 920,000 ton manganese production, the costs of AUD$2.19/dmtu and the fact that we can expect a 10% increase on the last half average price received US$2.10/dmtu ( they say US$2.09, but it actually works out at US$2.098)
New price is US$2.31/dmtu
Total income AUD $135,424,000 costs $96,710,400
Profit $38,713,600 for the full year ( last half was $14.5 million, this half AUD $24,213,600 and that's using their poor figures.
Not looking too bad eh. Although I still think that their price quoted does not represent the present market in China. But they maybe selling manganese cheaper to other customers.


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## Rimtalay (8 April 2007)

Trying to understand the Operations & Market Update, ie the mumbo jumbo on Chromite, try as hard as I can I have decided it is impossible to believe their figures. ConsMin managements price of US$148/ton FOB, is correct for the last 1/2 year. But a 6% increase over the full year would mean a 12% increase going forward. Rubbish, they are not living on the same planet or its a typo error. ( or they are giving it away, in which case we need to know WHY?)
Chrome ore is presently fetching US$350/ton for 42%.
www.asianmetal.com
[4-4] Chrome ore price overtops RMB65/dmtu in China 

chrome ore is fetching over RMB 65/dmtu. This equals US$8.40/dmtu or US $352.95 /ton for 42% chrome ore.

And it just didn't happen on the 4-4-07, its been high for weeks.
This is from www.asianmetal.com a few weeks ago. ie: 6th Feb 07

"Chinese consumers receive much higher offers of Cr ore 2007-2-6 12:59:57 BEIJING (Asian Metal) 6 Feb 07 – Chinese consumers reported to Asian Metal that lately they received much higher offer prices from international suppliers, even with some overtopping USD320/t CIF China. A Gansu-based consumer reported that they bought 900t of Pakistani lumpy Cr ore 40% mid last week at RMB56.5/dmtu (USD6.43/dmtu) ex port Tianjin. “ The trading company offered RMB57.5/dmtu (USD6.54/dmtu) ex ports when we called again after two days last week, additionally, I heard that some deals were made as high as RMB64/dmtu ex ports, which is unbelievable to me, ” added the source. a Liaoning-based consumers complained that a supplier even offered as high as USD328/t CIF China for lumpy Cr ore 40%min, origin from Pakistan. “ My Turkish suppliers informed us that they have few cargos available until April, ” remarked the source. A trader based in Tianjin was also informed by her Turkish suppliers that there are limited materials for prompt shipment. She revealed that a reliable supplier offered USD235/t CIF China for metallurgical grade lumpy Cr ore 42% twenty days ago, but she did not accept that offer in view of increasing adventures in the business. “ I will come back to the market after the Spring Festival holidays, ” said the source.


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## noirua (11 April 2007)

An old speech by Mr Michael Kiernan MD on the 5th June last year. A bit difficult to listen to with the coughs and clinking of glasses, but please perservere. Is there anything in this:  http://www.brr.com.au/event/CSM/851/11593


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## Rimtalay (11 April 2007)

This does not sound good for shareholders of ConsMIn. 
http://www.mineweb.net/mineweb/view/mineweb/en/page36?oid=19260&sn=Detail

DEALS UNDER SCRUTINY 
Fiddlers under the roof – Vekselberg, Deripaska and Gilbertson 
Asset claims shadow Rusal IPO and Consmin takeover bid
Author: John Helmer 
Posted:  Tuesday , 10 Apr 2007 

MOSCOW -  
With a little more bulge at the waistline, and a little more bush in his beard, Victor Vekselberg would be a dead ringer for Tevye the Milkman, hero of Fiddler on the Roof, Broadway's most famous musical about Russia. The fiddler of that tale was a symbol of survival in the rough days in Russia, before the Communist Revolution.
In the fifteen years since that revolution was reversed, starting in 1992, Vekselberg has survived especially well. You might say that Victor's theme song has taken all the conditional out of Tevye's famous refrain, If I were a Rich Man: 
Lord who made the lion and the lamb 
You decreed I should be what I am 
Would it spoil some vast eternal plan 
If I were a Wealthy Man?
But as a fiddler, according to complaints that are being tested in the courts of Russia and other jurisdictions, Vekselberg is a schemer of a different sort, allegedly converting other people's assets to make them his own. He denies this, and so does his most important lieutenant for the past two years, Brian Gilbertson.  Both are about to ask the London market to believe them - Vekselberg in a main board listing of bauxite and aluminium producer, United Company Rusal; and Gilbertson in an AIM listing of the merger between manganese, chromite, nickel and iron-ore miner Consolidated Minerals (Consmin) and Pallinghurst Resources.
The allegations are also a test for JPMorgan Cazenove, which is believed to be seeking a mandate for the Rusal IPO; and which, on March 30, was formally named by Consolidated Minerals as its global broker, replacing Numis Securities. 
Eleven months ago, according to one of Russia's wealth charts, Vekselberg possessed a fortune of $9.7 billion. Another wealth tracker, Forbes Russia, estimated it at $10 billion for 2006; that was double his fortune in 2005. According to Forbes also, Vekselberg occupied the 5th rung of the Russian ladder of fortune. These estimates are all based on the attributable value of Vekselberg's stakes in aluminium and bauxite producer SUAL; oil company TNK-BP; and conglomerate holding company, Renova. Vekselberg should soon be in a position to know exactly what his paper is worth, because he is selling out - converting his SUAL stake into 22% of the newly merged United Company Rusal, and then selling a sizeable share of that in a London IPO; selling his shares in TNK-BP for cash, probably to state owned oil company Rosneft; a big chunk of Renova's power stakes are also up for cash sale. 
Buyers from Vekselberg, however, are obliged to ask the simple question - are the assets he's selling lawfully his? And not only buyers - Vekselberg's quondam rival, now erstwhile partner in United Company Rusal, Oleg Deripaska, is also facing similar challenges to the legality of his claim to the assets comprising his 66% stake in the new company. 
A source close to them both has told Mineweb that, in their negotiations of merger terms, each agreed to give the other the following discount-premium offer: if asset claims are settled with compensation payments, then the concomitant loss of  value in the merged company must be compensated. Either Vekselberg may gain shareholding at Deripaska's expense, or vice versa; or they may pay each other the money their asset troubles have caused. 
There are two pending claims, one against Vekselberg, involving an alleged fraud in SUAL's takeover of the Volgograd Aluminium Plant; and one against Deripaska by his former partner and godfather, Mikhail Chernoy, over a trusteeship agreement granting Chernoy a 20% stake in the pre-merger Russian Aluminium (Rusal) company, its capital value and its dividend stream; according to Chernoy, that sums to about $5.2 billion. 
The case against Vekselberg's companies has been moving through the Russian courts, and is now being prepared for filing abroad. The case against Deripaska was filed in the UK High Court last November 24. Mineweb has reported the detail of both cases before. 
The case claims set out allegations and particulars, which lawyers and bankers, who have been invited to prepare the marketing of the new Rusal shares in a London listing, cannot avoid investigating,  especially not if they are subject to the supervision of US Government regulators. Both Vekselberg and Deripaska concede they are in an awkward position there. Vekselberg renounced his US green card (permanent immigration visa) and limits his exposure to US court claims already pending against him, alleging fraud and theft of an oilfield. Through a spokesman, Deripaska has acknowledged being banned from entering the US for several years; a ban which UK and Australian officials have also corroborated, while they waived it for Deripaska to cross their frontiers. But the US visa he was granted between 2005 and 2006 has not been renewed. Lawyers for Deripaska in the UK have drawn up affidavits claiming he is almost never at his Belgrave Square house, or in his country home besides. 
In Deripaska's case, it was his butler who may prove to be the Achilles heel, jurisdictionally speaking. Sources close to the Chernoy case say that, following the High Court filing late last year, detectives shadowing Deripaska warned process servers that he was on his way from his aircraft to his home at 5 Belgrave Square, in London. When his car pulled up, the process server made his move, and Deripaska scuttled for the tradesman's entrance of the mansion. It was the butler at the front-door who took Chernoy's writ - and he has subsequently testified that he gave it to Deripaska. The High Court will hear argument from lawyers in the case over whether Deripaska has been lawfully served, and the case may commence. If the judge rules in favour of Deripaska's butler, the lawyers go into further argument over whether Chernoy's claim to have executed his shareholding deal with Deripaska in London allows the High Court to adjudicate the dispute. When and if the case comes to trial on the merits, Deripaska will testify that the signature on the agreement with Chernoy isn't his. 

End of Part 1   see part 2


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## Rimtalay (11 April 2007)

Part 2 - 

http://www.mineweb.net/mineweb/view/mineweb/en/page36?oid=19260&sn=Detail

DEALS UNDER SCRUTINY 

Registration of offshore companies, and initial placement offers (IPOs), also expose Vekselberg and Deripaska to government regulators and courts. Announcing the intention to sell shares in the new Rusal on the London Stock Exchange is an open invitation for those who claim their assets were fiddled to apply to the UK courts to retrieve them. Deripaska may have already proved that he is fleeter on foot that his Belgravia butler, but his and Vekselberg's acquisition tactics are now catching up with them. 
Brian Gilbertson, one of South Africa's best-known businessmen, says he had nothing to do with any alleged unlawful asset takeovers when he was chief executive of SUAL, the Russian aluminium company controlled by Vekselberg.  What Gilbertson did, or didn't do, knew or didn't know, during his time in Russia may be a footnote, as far as the Russians are concerned. But Australian shareholders, and regulators may be much more interested, when they review this month and next Gilbertson's takeover bid for Consolidated Minerals (Consmin) of Perth.
According to public announcements that began in February, Gilbertson and a South African associate Arne Frandsen have proposed a friendly takeover by their Pallinghurst Resources of Consmin. Details of where Pallinghurst's A$300 million cash offer is coming from are scarce. Gilbertson has told Consmin he is "targeting $1 billion of equity commitments"; that doesn't sound like the money is either in Gilbertson's pocket, or in Pallinghurst's bag, at least not yet. Brisbane-based AMCI, controlled by Hans Mende, has been identified by Gilbertson as one of his backers for the Consmin takeover. Six weeks ago, AMCI sold its Australian coal assets to CVRD of Brazil for A$835 million; subtracting net debt, it appears to have A$678 million cash on hand. Some of that appears to be buying Mende a seat on the board of the post-takeover Consmin. The Western Australian media have also reported rumours that Gilbertson's bid is being backed by Vekselberg as a silent partner in Pallinghurst. 
South African sources have told Mineweb they believe Gilbertson may have converted Vekselberg's promise to pay him a multi-million dollar bonus for a successful share listing for SUAL, because Gilbertson couldn't deliver on the IPO; and because Vekselberg was reluctant to concede the obligation to pay the reward.  Gilbertson declines to say if he and Vekselberg have settled for a promise from Vekselberg to deliver several dozen million dollars into Pallinghurst's capital. Vekselberg's spokesman  also prefers not to answer questions on the matter. 
With or without Vekselberg, however, Gilbertson's credibility is the driver of Pallinghurst's takeover of  Consmin; if he succeeds in creating the new company, to be listed in London and Frankfurt, Gilbertson and his associates would control it with 60% of the shares. But first the Australian, then the London market, must decide whether Vekselberg's and Gilbertson's acquisition record in Russia warrants trust.  
Gilbertson's name appears as one of the alleged defendants accused by Ralco, a 17% shareholder in the Volgograd Aluminium Plant, one of the key production assets taken over by SUAL soon after Gilbertson became chief executive of SUAL in Moscow in August 2004. Ralco says it was swindled out of its shareholding stake, and the Volgograd smelter fraudulently incorporated by SUAL between 2000 and 2005. Ralco's complaint has been before the Russian courts already. Asked what had happened to the Volgograd shares, Gilbertson told Mineweb: "I am satisfied that SUAL acted lawfully during the period of my tenure as President, and as you know, we had a well-staffed legal department to ensure that that was the case." 
Gilbertson's contract with SUAL began in August 2004. It ended at the start of this month, when SUAL agreed to merge with rival Russian Aluminium (Rusal), owned by magnate Oleg Deripaska. Gilbertson, who had been first choice to become chairman of the board of the new United Company Rusal, was dropped, and Vekselberg, who controls about 22% of the new company, has been named the new chairman.
For several years, Ralco has been pursuing both SUAL and Vekselberg's holding Renova through the Russian courts, alleging they contrived the takeover of the Volgograd plant, using false-front companies that have since disappeared; forgery of documents presented in the Russian courts; false testimony; and fraudulent share transactions.  The Russian authorities have investigated and substantiated some of Ralco's evidence, but Russian court rulings in Ralco's favour have been impossible to pursue, because the culprit companies have disappeared, or are empty of assets. International litigation to go after the alleged culprits has been in preparation instead.
The Volgograd smelter is an important asset in the merger deal between SUAL and Rusal. That deal officially closed, according to an announcement from the two companies, on March 27. Vekselberg was quoted by Rusal last week as claiming the new company "will promote a world class corporate governance structure, enabling us to meet the highest international standards..." 
First built in 1959, and upgraded since then, aluminium production from Volgograd is estimated to account for 17% of SUAL's pre-merger output. In the merged Rusal, it comprises at least 4% of metal production. At the start of 2005, Renova, Vekselberg's personal holding company, announced the takeover of the smelter by SUAL: "The process of incorporating OAO Volgograd Aluminium (VgAZ) into OAO SUAL Group has been completed," Renova's website says. "On 31 December 2004 VgAZ became a subsidiary of OAO SUAL. The incorporation of VgAZ was the final step in consolidating the aluminium assets that followed an agreement signed between SUAL Group and the management company, SevZapProm, in December 2002. Under the agreement, VgAZ and the subsidiaries of OAO Metallurg, Volkhov Aluminium and Pikalevo Alumina, were integrated into the SUAL Group production chain two years ago. In 2004 OAO SUAL was re-organised to integrate these companies. On 30 September 2004, Volkhov Aluminium and Pikalevo Alumina became subsidiaries of OAO SUAL."

"The re-organisation of OAO SUAL and integration of VgAZ was based on a decision taken at an extraordinary general meeting (EGM) of shareholders on 31 August 2004. An absolute majority at the meeting voted in favour of the incorporation of VgAZ into OAO SUAL. On 15 December 2004, an amended charter was adopted at an EGM of OAO SUAL's shareholders to reflect this re-organisation. On 31 December 2004 the Uniform State Register noted the termination of activities at VgAZ. This formal procedure finalised the consolidation of OAO SUAL Group and VgAZ, its eighth subsidiary." 
That states the legal position in Russia, as Vekselberg sees it, and also Gilbertson. Ralco's position in the Russian courts has won rulings from the bench, and Ralco sees the legal position differently.  This is a challenge to the plans Vekselberg and Deripaska have announced to publicly list and sell their shares in the London IPO. Investment bankers claim the new company should hit a valuation of $30 billion.
Ralco has identified Gilbertson and Vekselberg, along with two others linked to both SUAL and Renova; plus 18 companies that fall under Russian, US and UK jurisdiction. 
Ralco charges that its 17% stake in the Volgograd smelter was first diluted illegally, and then taken in a regional court case far from Moscow, when debts and evidence were fabricated, and the judge misled, while Ralco was kept in the dark, and "represented" at a court hearing by an impostor paid by Ralco's attackers. Ralco estimates the value of its stake at more than $40 million, and it has the option to seek treble damages if it can prove racketeering.
A string of two Russian and one Cyprus-registered companies has also been identified as participating in the alleged scheme to convert Ralco's shares into SUAL property in the months just before Gilbertson took office, and in the following six months. 
Gilbertson acknowledged in mid-2005, almost a year after he took over at SUAL, that he was aware of the Volgograd smelter case and the Ralco claims. He said he was appointing a new legal counsel at SUAL to look into the affair. Maxim Goldman took this position in July 2005. 
In November 2004, after Gilbertson's engagement and following a Volgograd regional court ruling, which had invalidated the dilution of Ralco's shareholding, SUAL had said through a spokesman: "concerning Volgograd Aluminium, we are sure our partners are in the right. Beyond this, we do not wish to add anything further." 
That's as kosher as Tevye the Milkman could have wished for - unless it's wishful thinking.


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## Rimtalay (14 April 2007)

Numis Securities ConsMins EX UK broker has upgraded further in just a week from 1.26pound UK to 1.46 pound UK. Thats AUD$3.37

"* Numis has upgraded Consolidated Minerals to buy from add with a 146p target"


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## kerosam (14 April 2007)

just out of curiousity... will management play games to keep the share price low for a convenient take-over price? Management seems to be on Gilbertson's side. i think there is a possibility that management is witholding any positive news of the company... in a asx-compliance sense of course.  

any rumours out there about a second buyer???


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## noirua (14 April 2007)

Rimtalay said:


> Numis Securities ConsMins EX UK broker has upgraded further in just a week from 1.26pound UK to 1.46 pound UK. Thats AUD$3.37
> 
> "* Numis has upgraded Consolidated Minerals to buy from add with a 146p target"




Hi, The targets you mention are quite interesting. Consolidated Minerals (CNM) closed in London on Friday at £1.085 and that is just 0.5p off their six month high.


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## Rimtalay (15 April 2007)

This story is from www.minweb.com to see the full story go to the link below.

ConsMin management *are* trying to keep the good news quiet.
 I have emailed them many times about the prices that I am getting for chrome and manganese from Chinese Metal traders, ConsMin management  say that they are happy with their position and consider that they are not breaking the ASX disclosure rules, but they *are* definitely stretching them.

http://www.mineweb.net/mineweb/view/mineweb/en/page67?oid=19348&sn=Detail


SHAREHOLDER OPPOSITION 
Gilbertson’s initial bid for ConsMin may be holed
Investor resistance and a strong share price may force Brian Gilbertson’s Pallinghurst Resources to raise its bid for Australian miner Consmin.

Author: Ross Louthean 
Posted:  Wednesday , 11 Apr 2007 

PERTH  -  

Brian Gilbertson's good ship Pallinghurst Resources may be heading for the shoals in its takeover bid for the West Australian manganese, chromite and nickel miner Consolidated Minerals Ltd.

There has been mounting shareholder opposition to the bid - complete with a dedicated anti-takeover website -- and the rising share price is adding another negative.

ConsMin's share price on the Australian Stock Exchange today was $A2.63 ($US2.16) and the Pallinghurst offer was $A1.38/share ($US1.13/share) plus two shares in the new Consmin for every five shares held, with shareholders receiving a 40% stake in the new company. Pallinghurst wants to gain a minimum 50.1%. At the time ConsMin (whose board is supporting the Pallinghurst bid) said the transaction valued the company at an enterprise value of $A625 million ($US515), or at $A2.28/share ($US1.87/share).

One Perth stockbroking firm assessed that the market value today of the Pallinghurst package was $A2.30/share ($US1.89/share) which, with market unknowns, does not make it attractive compared to the raw share price, which has been lifting through improved production performances and a soaring nickel price. The Intierra group's Minmet research service put the market capitalisation of ConsMin today at $A595.2 M ($US490.7 M).

Alex Passmore, Head of Metals & Mining for Paterson Securities, who felt the bid was heading for the rocks, believes Pallinghurst must increase the offer.


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## kerosam (15 April 2007)

If this is true, and the Gilbertson-led bid & take-over is not successful, then this present management has got to go...


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## noirua (15 April 2007)

Pallinghurst will probably play this one out in a similar manner to Cemex in their bid for Rinker Group. Just leave the bid on the table and wait and see if a rival bidder turns up. If no rival appears on the scene, then the cash part of the offer will be raised to give a price at the bottom end of estimates. It's as simple as that.


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## Rimtalay (16 April 2007)

MINING NEWS JUST OUT, I will post the whole story as I cannot link to it, as you must be a member to read it.

MINING NEWS - JUST OUT NOW 

Takeover bid still a goer: ConsMin  

Paul Garvey
Monday, 16 April 2007

CONSOLIDATED Minerals managing director Rod Baxter has again defended the bid of Brian Gilbertson's Pallinghurst Resources, following claims from the company's ex-advisor that the bid was "heading for the rocks".




Numis Securities, which was the broker and nominated advisor regulating ConsMin's London listing before its sudden resignation soon after the Pallinghurst deal was announced, said on Friday it had upgraded its target price for ConsMin to 146p, or around $A3.65.

"Brian Gilbertson and the team at Pallinghurst may need to revise their offer for Consolidated Minerals as the shares rise above the effective 96p ($2.40) offer," Numis said.

Pallinghurst – headed by former BHP Billiton head Gilbertson – is offering $1.38 cash plus two shares in the new ConsMin for every five currently held. The per-share value of the bid, which had a notional value of $2.28 per share when it was launched, was $2.448 in morning trade based on the current price of $2.67.

Speaking to MiningNews.net, Baxter said he did not agree with Numis' suggestion that the Pallinghurst bid was in trouble, adding that a recent road show through Australia, North America and Europe had met with a favourable response, particularly from larger institutional investors.

In addition, Baxter pointed out that the two-for-five share component of the offer meant shareholders could participate in the upside of the new ConsMin.

"That was the whole essence of this transaction," Baxter said.

"We wanted to give shareholders exposure to the upside in the ConsMin growth story going forward. As the share price moves up as people become more comfortable with the offer, the value of the offer also rises."

Baxter added that both Gilbertson and Hans Mende – the head of private coal group AMCI, Pallinghurst's partner in the ConsMin bid – would be arriving in Australia soon for another series of road shows to Australian investors.

Baxter also dismissed suggestions that the market update issued by the company on the Thursday afternoon before the Easter break was a response to mounting pressure from the shareholders behind a website urging ConsMin investors to vote against the Pallinghurst offer.

The Consolidated Minerals Takeover – Vote No website has used reported rallies in the manganese and chromite markets as justification for its opposition to the bid.  

However, Baxter said the market update was consistent with its continuous disclosure policies.

"We consistently said when the new management took over we would continue to look at our ongoing disclosure obligations, and share with our shareholders what's happening with the company," Baxter said.

Baxter said that a fall in manganese stockpiles in China had driven a slow uptick in the manganese market, although that had been partially countered by rising shipping costs and a strengthening Australian dollar.

ConsMin is increasing FOB manganese prices to rise by 8-10% on the $US2.09/dmtu received in the first half of financial 2007.

Chromite prices, meanwhile, are now expected to increase by around 6% on the $US148/t received in the first half.

ConsMin shares were up 2c to $2.67 in morning trade today.


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## ozambersand (20 April 2007)

Here's an update on this saga (which has gone quiet of late!)



> Warwick acquires ConsMins gold, chromite projects
> 20-April-07 by Edited announcement
> 
> West Perth-based minerals explorer Warwick Resources Ltd will acquire eight tenements adjoining its gold and chromite projects, from Allarrow Pty Ltd and Consolidated Minerals Ltd subsidiary Pilbara Chromite Pty Ltd, through a scrip issue.
> ...




Will this have any bearing on the proposed take-over of CSM? 

I am also confused about the Appendix 3B posting from 11/4. Why have a stack of options been cancelled? I note no names have been linked with it.


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## Rimtalay (20 April 2007)

Hi, I doubt whether the deal with Warwick Resources will have any impact with the Pallinghurst Resources deal with ConsMin. Although sounds like ConsMin will pick up $1.5 million on the deal ( 400,000 shares in Warwick).
I do think however the deal with Allarrow P/L for the exploration tenements that host Chromite ore whilst a low grade could be profitable. You might already note ConsMin is the only chromite miner in Australia. Chrome ore is rocketing in China due to the export tax of US$44/ton imposed by the Indian Gov't on Chrome ore. 
ConsMin is making $$$$ on Chrome ore at present. This is from Chinese metal trading websites. Includes chromite and manganese details.
www.metal-pages.com  19th April 07
Chrome ore surges to new high 
European Mn market consolidates gains 
European manganese spot prices have been relatively steady in the past week after a strong bull run that has seen the market more than double in price since the start of the year, dealers told Metal-Pages today. Manganese flake prices are around $4,300-4,600/tonne.
www.asianmetal.com  19th April 07
Higher offers on Chinese manganese ore market 2007-4-19 10:54:08
Chromium metal prices firm in India 2007-4-19 11:39:39
FeCr demand still strong in India 2007-4-19 10:53:21
Mn alloys market out of control in India 2007-4-19 9:11:45
Ferromanganese market firming up 2007-4-19 8:51:04
Chinese FeCr producers raise prices further 2007-4-19 8:46:02
FERRO-ALLOYS Japan Q2 ferrochrome at record high of 90c [2007-04-17] 
FERRO-ALLOYS Prices of Domestic Chrome Market Increased Totally [2007-04-17]
 FERRO-ALLOYS The Influence of Chrome Price on SS Enterprises Is Limited [2007-04-17]
 ORES&CONCENTRATES Global Chrome Ore Price Soaring [2007-04-17]


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## wintermute (21 April 2007)

ozambersand said:


> I am also confused about the Appendix 3B posting from 11/4. Why have a stack of options been canceled? I note no names have been linked with it.




I suspect that an employee resigned, or was terminated, and their employee bonus options were canceled (I think they were unlisted weren't they)... 

Tony.


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## ta2693 (22 April 2007)

Rimtalay said:
			
		

> You might already note ConsMin is the only chromite miner in Australia.




 

Are you sure?

As far as I know, there is another one: BHP.


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## Rimtalay (23 April 2007)

Hi ta2693, Consolidated Minerals has the *only* chromite ore mine in Australia, as it has the only economical chromite deposit 42% Cr2O3, that has been discovered in Australia.
Warwick Resources has announced that it has now secured the West Coobina Chromite leases, but the grade is low, only 16% Cr2O3, and whilst it is possible to upgrade the ore, it does become more expensive.
Chromite ore has gone ballistic in China, mostly because they don't have much themeselves except for deposits at Norbusa and Donchao which are in Tibet. These deposits are becoming more viable since the openning of the railway line to Tibet last year. However China needs a lot of Chrome ore for its stainless steel factories, even with the low grade stainless steel , ie 'crap' 200 series they need manganese and chromite.
South Africa has the largest deposits, and yes BHP have some mines there, Xstrada etc. The next largest deposits are in Kazakhstan , at Donskol. Turkey and India also export Chrome ore. 
The Indian Gov't has introduced a US$44/ton export tax on chrome ore. The South African Gov't is imposing a total ban on unbeneficated chrome ore.
AS a result chrome ore is up 100%. Consolidated Minerals should be starting to make a killing. The management either 
(A) stupid and don't know that chromite has gone up 100% and are still selling it at the old price. 
OR (B) they are making heaps and do not want to tell the market in case the shareprice goes up and the Pallinghurst Resources takeover deal is dead.
I would think it is (B) and remember that Consolidated Minerals produce 250,000 tons and at an extra $100/ton adds an extra $25 million profit.


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## Rimtalay (23 April 2007)

ConsMin don't forget about NICKEL 200,000 tons of conatained nickel at 1% cut-off worth $12 billion.
KITCOMETALS


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## Rimtalay (24 April 2007)

News story re Gilbertson's takeover of ConsMin. I will post the full story as its a subscriber story.

CONSOLIDATED MINING
From outpost to outback
By Brendan RyanExpect the present management to be working to a new strategy
  Having made piles of money for SA, Australian, British, Indian and Russian investors - not to mention himself - Brian Gilbertson has now picked an obscure Australian nickel producer as his next growth vehicle.

The company is Consolidated Minerals (Consmin), listed on the Australian stock exchange and London's AIM bourse.

Gilbertson is bidding for control through a private investment company - Pallinghurst Resources - which he runs with Arne Frandsen, the former CEO of Incwala Resources.


WHAT IT MEANS
Consmin should fill an investment void left by takeovers
Big plans to build up a small operator

Consmin MD Rod Baxter is ex-Anglo American, though he has just taken out Aussie citizenship, and two executives, Garth Higgo and Alistair Croll, are former Anglo Platinum executives who recently emigrated to Australia.

If the deal goes through, Gilbertson will join the Consmin board as a non executive director. Frandsen will move to Perth to become executive director responsible for strategy. The existing Consmin management team will stay.

Gilbertson and Frandsen go way back, through involvement in deals in Frandsen's investment banking days at JP Morgan. Gilbertson helped create Incwala.

Consmin documentation indicates Gilbertson began negotiating the deal in October last year. At that time he had just finalised the merger of Russian aluminum producers Sual and Rusal, and he told the FM (Features October 13 2006) that he would be staying on to oversee the listing of the merged group on the London Stock Exchange.

After that it seemed retirement would beckon, as he was pushing 65. "I must say, retirement at Plettenberg Bay looks very appealing," he said at the time. Not any more - he's now committed to involvement with Consmin for three years. Gilbertson acknowledges he would like to get more of a balance between his business and personal lives, but concedes it's something he has not been good at. So why carry on? Is it the challenge? The money? "Both. I get a kick out doing this," replies Gilbertson, who has already cleaned up on share option payouts after his stints at BHP Billiton, Vedanta and Sual.

His departure from all three groups has been controversial. The conspiracy theorists are now speculating about a fallout between Gilbertson and his former Russian backer, Victor Vekselberg, who was the major shareholder in Sual. But there is also speculation that Vekselberg is one of the investors in Pallinghurst. "He may be," replies Gilbertson, who declines to name all the investors in Pallinghurst.

Consmin operates small manganese, chrome and nickel mines and plants in Western Australia, with an active iron ore exploration and development programme. It also has interests in copper, zinc and tungsten.

Consmin believes it could consolidate a number of small iron ore players in the midwest region of Western Australia.

Higgo says the intention is to transform Consmin into a "midtier" mining group over three to five years, filling an investment void created by takeovers of groups like North, MIM, Normandy and WMC.

The obvious question is whether Consmin will go the same way. Not easily, Higgo replies, given the size of the controlling block held by Pallinghurst, even though this may be diluted over time.

Pallinghurst is a joint venture investment vehicle based in London, backed by privately owned resource group AMCI, which has a co-investment arrangement with Pallinghurst.

AMCI holds investments world wide, including large coal interests in Australia. It has just sold some of these coal assets to CVRD and it seems likely the remaining coal assets could go to Consmin. AMCI cofounder Hans Mende will also be joining the Consmin board.

Gilbertson says Consmin is the second of "between five and 10 " investment opportunities Pallinghurst is looking for. Pallinghurst's first deal was to buy the rights to the Fabergé brand name.

Asked where he will be based, Gilbertson says: "London, SA, Australia - wherever it makes sense to be." One place it will not be is Moscow; Gilbertson sounds relieved to be out of the bitter Russian winter and back at his house in Plett.


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## Sainter (25 April 2007)

An article in today's West suggesting a private equity group led by UBS and Goldman Sachs JB Were is believed to be running the ruler over CSM. Speculation also suggests they might try to lure Michael Kiernan back.
It can't be any worse than the cr@# Gilbertson and Baxter are trying to force us to accept. And besides an increased offer, ousting Baxter would be the next best thing that could happen from a shareholder perspective.


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## Rimtalay (25 April 2007)

Private equity group mulls move on ConsMin    

25th April 2007, 9:00 WST


A private equity consortium led by investment banks UBS and Goldman Sachs JBWere is believed to be running the numbers on WA miner Consolidated Minerals to counter Brian Gilbertson’s floundering $320 million partial takeover offer. 

The former BHP Billiton chief’s Pallinghurst Resources is seeking a 60 per cent stake in a revamped ConsMin via a friendly cash and scrip offer notionally valuing the miner at $2.28 a share. 

But the offer has failed to gain traction due to its lack of any control premium and the expectation that the deal will have to be sweetened to succeed. 

That has kept ConsMin shares, which yesterday eased 4¢ to $2.50, well above the notional offer price since it was unveiled in February. 

Against that backdrop, industry sources said the two banks were working on a potential rival deal backed by fresh private equity funding from Australian and overseas investors. 

UBS and Goldman Sachs JBWere declined to comment. 

But on Monday, Goldman Sachs coincidentally raised $415 million to launch a new Australasian private equity fund with a “mid-market focus looking at deals of around $100 million to $500 million”. 

Rumour suggests any rival offer may include splitting ConsMin’s underground nickel mining operations from its open pit mines in the Pilbara for sale to new operators. 

Speculation also suggests the proponents may seek to lure back ousted ConsMin founder Michael Kiernan to take charge of the Pilbara operations, which account for 10 per cent of the world’s manganese supplies. 

ConsMin’s share price plunged after Mr Kiernan quit over a pay dispute in late 2005 and the company has since struggled in the face of volatile manganese prices and difficulties at its nickel mines. 

But manganese and chromite prices have rebounded strongly, and nickel prices have blasted past $US50,000 a tonne since Pallinghurst began negotiating with ConsMin in October. 

Yet Pallinghurst has refused to budge from its initial offer of $1.38 a share in cash, plus two shares in a new ConsMin for every five shares held in the current company. The new Cons-Min would be 60 per cent owned by Pallinghurst and bid partner AMCI Holdings. 

Mr Gilbertson will return to Australia next month for an investor roadshow but faces a tough task convincing wavering investors to accept. 

“The clock is well and truly ticking, and Brian desperately has to pull a rabbit out of the hat,” one source said yesterday. “At the end of the day, if someone comes up with a reasonable alternative, it may be all over.” 

A ConsMin spokesman said the company did not comment on “market speculation”.


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## ta2693 (25 April 2007)

That is a very good news. It is very interesting to see the performance of this stock next week.
My understanding of this sentence "UBS and Goldman Sachs JBWere declined to comment" = acquiescence  
Do you agree?
Rim - Thanks for your sharing and continuing studying of this one.


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## Rimtalay (26 April 2007)

STRONG SPECULATION www.mineweb.net Does Gilbertson have a rival for Consolidated Minerals?
A competing bid by a grouping of financial institutions is thought to be on the cards for Consmin – already the subject of a bid from Brian Gilbertson-led Pallinghurst. 

Author: Ross Louthean 
Posted:  Wednesday , 25 Apr 2007 

PERTH -  

Now that the Australian sharemarket has started going cold on the Pallinghurst bid for control of manganese, chromite and nickel miner Consolidated Minerals Ltd, there is warm speculation of a competing bid that may certainly put Brian Gilbertson off his Corn Flakes.

Mineweb reported early this month -- after the share price of ConsMin had begun to lift -- that the Brian Gilbertson-led Pallinghurst bid for the company was now looking unattractive and that brokers felt Gilbertson would have to sweeten the bid.

However, there are now suggestions of a counter bid, with Western Australia's daily newspaper The West Australian reporting that a private equity group was now eyeing ConsMin.

According to the report international investment banks UBSS and Goldman Sachs JBWere were running numbers on ConsMins to counter "Brian Gilbertson's floundering $A320 million ($US266 M) partial takeover offer."

Today was ANZAC Day, a public holiday to commemorate Australian and New Zealand soldiers who have fallen at wars beginning with the disastrous assault on Gallipoli in World War I. Though trading of ConsMin shares on Tuesday finished down A4 cents to $A2.50 ($US2.08) it was still mathematically well above the Pallinghurst offer.

What helped fan the speculation of a Goldman Sachs JBWere move was a raising at the beginning of this week by that Melbourne-based firm linked to one of North America's biggest banking and broking houses of $A415 M ($US345.3 M) to reportedly look at "mid market" deals, a category into which ConsMin falls.

As Mineweb indicated there is strong speculation that anyone targeting ConsMin may look at hiving off the Beta Hunt nickel mining operations in Kambalda, given that other new nickel miners who picked up mines in that area are making spectacular profits with the high nickel price, and their low operating costs.

Pallinghurst's bid has set a minimum target of 50.1% and when launched had the support of the ConsMin board.

Reportings to the Australian Stock Exchange to trading close on Tuesday showed that ConsMin is yet to release its March quarter report, and this will have a big bearing on the share price and the Pallinghurst relationship and whether Gilbertson's appetite is whet to lift the bid or whether the cited private equity group would make a move.


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## Rimtalay (26 April 2007)

When the bid by Pallinghurst Resources was announced in Feb 07 the company stated that the scheme documentation would be sent to shareholders in mid April 07, and voted on in mid May 07. For no good reason this has been extended till June 07 and voted on in July 07.
Many shareholders have indicated that this delay is not acceptable .

ConsMin shareholders, please advise your feelings on this delay.
We are planning a detailed submission to the ASX and ASIC


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## Rimtalay (27 April 2007)

MINING FINANCE & INVESTMENT ( I will post full story as you may not be able access it)
SURVIVING RUSSIAN ALUMINIUM 
Gilbertson’s retreat from Moscow – more hot than cold
The big South African prepares resourceful counterattack.

Author: John Helmer 
Posted:  Wednesday , 25 Apr 2007 

MOSCOW -  

Brian Gilbertson was the most important international executive ever to work for a Russian corporation, when he moved to Moscow in August 2004, signing on as president of Siberian Ural Aluminium (SUAL), a mining and metals company. He still is, but that's because no-one of comparable importance has followed him, either on the smooth road into Moscow, or on the bumpy one out.

The Gilbertson appointment, accompanied by published hints of a 50 million-sterling bonus, was also Victor Vekselberg's biggest catch, in his attempt to take his second-string private company to a public listing on the London Stock Exchange.  Vekselberg is one of Russia's richest men; and also one of those to be found on the defendants' list in court cases alleging he had lifted someone else's assets. At the end of March, Gilbertson parted company with Vekselberg. 

Behind Gilbertson's back, Vekselberg told Russians he was more than unhappy with the big South African. For one thing, Gilbertson had proved unable to generate market support for the SUAL float on which Vekselberg had been counting. Never mind that it had been President Vladimir Putin himself, who told Vekselberg last September that Vekselberg would not be allowed to take his company public by itself. Instead, Vekselberg has had to accept a 23% stake in a merger with his rival Oleg Deripaska's Russian Aluminium (Rusal).  Initially, Gilbertson was slated to be the representative of that stake as non-executive chairman of the new company.   Gilbertson also reportedly tried winning Deripaska over with the prospect of a takeover bid for Anglo American. 

But when the Kremlin, Deripaska, and Vekselberg agreed among themselves that the chairman of the new Rusal had to be Russian, and Vekselberg himself took the seat,  Gilbertson had nothing left to do in Moscow,  but to claim his bonus. Vekselberg said no. Unlike several of his argumentative predecessors in the Russian aluminium business, who have ended up in hiding, in prison, or in a body bag, Gilbertson was allowed to leave in one piece. 

Apparently, for Vekselberg will not corroborate the details, and Gilbertson is still biding his time before spilling the beans, the bonus was just one of several arguments between them. Another - which Vekselberg's subordinates claim to be still in negotiation with Gilbertson - concerned Gilbertson's new global investment vehicle, Pallinghurst Resources (PR). Registered on a Caribbean island, and headquartered in London, PR has already opened a cash and scrip bid to take over the West Australian multi-mineral miner, Consolidated Minerals (ConsMin). In his opening offer, Gilbertson said that Pallinghurst is backed by a billion dollars of "equity commitments". Vekselberg is now claiming to his associates that not a penny of that will be his. 

A third argument, which Gilbertson's son Sean has corroborated, is over what was intended to be a profitable development of Faberge, the trademark of the royal Russian jeweller a century ago. This was put on sale last year by Unilever for $40 million. Alrosa said it wasn't worth more than $5 million. Vekselberg had in mind to buy cheap, and resell to Alrosa, cutting others into the deal proceeds, if he succeeded. But Pallinghurst jumped in first, buying Faberge for a price that has queered Vekselberg's scheme.   

When he took over at SUAL, Gilbertson conceded there was much he didn't know about how Vekselberg and his associates had put together the bauxite mines, alumina refineries, and aluminium smelters which had become SUAL's assets. Gilbertson appointed his own lawyer to investigate whether any wrong had been done, especially in the case of the Volgograd Aluminium Plant, an asset which was consolidated on to SUAL's balance-sheet several months after Gilbertson took charge - and legal responsibility. For a dispossessed shareholder in that smelter had already won Russian court rulings supporting his claim to have been robbed. The Volgograd claim has since been reviewed by international lawyers, and as Vekselberg moved towards a London listing, so has the prospective jurisdiction for a hearing on the allegations. 

In more promising days, it was Gilbertson who introduced Vekselberg in South Africa, and encouraged him to make promises of black empowerment cash, and a billion dollars of investment besides. Those promises landed Vekselberg a warm seat on President Thabo Mbeki's international investment advisory council. Vekselberg's wife decided that she wanted to buy the Cape wine farm and hostelry, Vrede en Lust, while her husband's involvement in funding ANC front companies has been under hot investigation for several months.


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## Rimtalay (30 April 2007)

Consolidation, then growth
Clive Henley
April 30, 2007 12:00am
THROUGHOUT its long history on the stock exchange Consolidated Minerals - first listing in 1969 - has kept a relatively low profile.
It has survived a number of market booms and busts. A new chapter in its history is unfolding now with a scheme of arrangement on the table. 
The proposal by British-based Pallinghurst and AMCI is to form a new ASX-listed resource company. 
Shareholders in CSM have been offered $1.38 and two shares in the new company for every five CSM shares. This offer equates to around $2.30 per CSM share. 
It is opportunistic and well timed, coming as it does after a 2006 profit impacted by depressed manganese prices. It also does not reflect an adequate premium for a change in control at CSM. 
The company mines manganese and chromite near Port Hedland in Western Australia and nickel at Kambalda. Like nickel, manganese and chromite are raw materials for carbon and stainless steel. 
CSM also has a 20 per cent interest in the Jaguar copper project near Leonora and an iron ore project in a joint venture with Fortescue Metals. 
Following a loss in fiscal 2006 earnings are set to jump this year. Forecast earnings for 2007 equate to 17.6 per share with a dividend of 4 forecast placing the stock on a 1.6 per cent yield at prices around $2.50. 
Forecasts for the 2008 financial year are for earnings per share of 39.8; a prospective price to earnings ratio of a low 6.3 times. 
The injection of new blood into the company appears a definite positive. 
Pallinghurst Resources is a natural resources investment vehicle chaired by Brian Gilbertson (ex-BHP Billiton). 
From a technical standpoint the price action in recent times shows that the shares suffered a steady decline in line with retreating earnings in 2005-06. 
From a high of $4.40 in August 2005, a low of $1.60 was reached in June 2006. Things have since improved. 
First, in October last the downtrend was broken following a strong rally to $2.50. 
This, when combined with the fact that the target from the top of $1.80 had been met and exceeded last June, is a bullish sign. 
Recently a new high at $2.70 represented the breakout of a base pattern with a short term target of $3.80 and possible longer term target of $4.80. 
Some recent weakness is finding support at $2.50 which appeals as an attractive purchase point with those willing to take some risk. 
- Clive Henley is a technical analyst/adviser at Tolhurst Noal. clive.henley@tolhurst.com.au


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## Rimtalay (3 May 2007)

If you read the latest Bell Potter research document<br>http://www.usail2.com/CSM_070427%20Bell%20potter.pdf<br>you will be horrified to see that these dimwits either can't add up or have a $100 million typo in their research.<br>I hope your not paying this pack of clowns for information. They show a downgraded FY07 annual sales revenue of $186.9 million when it should show an upgraded $280 million. <br>see the Consolidated Minerals Vote No website<br>http://www.usail2.com/consolidated_takeover_updates.htm


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## Sainter (3 May 2007)

From the VOTE NO website-CSM shareholdings in other companies
http://www.usail2.com/consolidated_takeover_assets.htm

NAME; No of SHARES HELD; % OF COMPANY; SHARE PRICE; TOTAL VALUE
JABIRU, 117,787,353; 31.73%; $1.245; $146,645,254
BC IRON; 15,000,000; 28%; $1.55, $23,250,000
MITHRIL; 7,115,000; 19.99%; 0.435c; $3,095,025
REED RES; 12,300,000; 17.75%; 0.495c; $6,088,500
VITAL METALS;11,105,150; 13.74%; 0.74c; $8,217,811

LAST UPDATED 3rd May 07 *Total Value  $187,296,590.00*

So, that means CSM market cap currently $568M-almost a third is made up of other companies which Baxter can't fudge the values on or deliberately talk down their prospects. 

You could argue then that CSM's profit from its Ni, chromium and manganese assets are from the smaller capital base of $381M.

My conservative H2 projections, based on info from CSM announcements, are as follows:
Mn income (AFTER mining costs)	$18.9M
Cr income(AFTER mining costs)	$25.1M
Ni income(AFTER mining costs)	$32.7M (based on reduced target of 4000 tpa)
SUM	        $76.7M

Assume admin expenses of $30M, as it was in H2 '05 and H1'06.

NPBT $46.7M

Tax@30% = $14.0M

NPAT $32.7M, or 14.4 cps. 
Remember this is projected H2 profit only. For full year, add $10.2M = $42.9 and PER 14.
PER 14 is not great, but H1 was average. If PER based on 2*H2, PER = 9.2.
Don't forget these are conservative numbers, chromium and manganese are jumping up in price, Ni will not be hedged come next FY, and more Ni should be produced as they reach richer orebodies. 

To put it in perspective, 4000t Ni @US$45k/t and exch rate of 83c and cash cost A$7.5 per payable pound gives income AFTER mining & smelting costs of A$88M. If they can ramp up to 6000 tpa (should not be too hard given they projected 5000 tpa this year and 15000 tpa by 2009-11), this becomes A$132M.  And this does not include Mn or Cr.

$2.28 a share? Gimme a break!


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## noirua (3 May 2007)

This looks to be a continuing ongoing saga and some may be wiser to exit this stock on the next speculative uplift.

There is a two way thought into the Board of CSM accepting and recommending the offer. At least a fortune isn't being spent on defending the bid.

So far no one else is interested in CSM and this will lower expectations and the level of the raised bid, if and when it comes.

When working out a value for a particular mine or project there is the risk factor to be added in and this markedly reduces the value of an asset. Maybe from 10% to 50% with financing a big factor but by no means always the biggest.


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## Rimtalay (4 May 2007)

Have you seen the Vote NO website
ConsMin currently has $187 million in other companies in shares JML,BCI,MTH,RDR,VML that is 83c per share before we start on 200,000 tons of nickel at US$23/lb. ($12 billion) There is 30 million ton of manganese as they upgrade the resources and reserves with the new discoveries. Chromite is at an all time high, and what about Mindy Mindy iron ore.
 The bid will not pass without a price close to $3/share, we have some shareholders currently running all the numbers, I'll start posting them soon, once we get all the information, ConsMin could be looking at profit of $60 million FY07, thats a 10% return on investment on a share price of $2.67, that's almost unheard of.
Hundreds of shareholders have contacted the Vote NO website and all but one person will vote NO, and the one YES vote did not leave their ID,I'm sure it was a Company Stooge, like Blue Bay Diver on ASF.


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## Rimtalay (4 May 2007)

Nickel ,
A) for the March Quarter we have 493 payable tons at US$11.10/lb and using AUD$1 to US0.82 ie. Total $14.68 million . Balance of the March Quarter production is 473 payable tons at AUD$24.84 /lb Total $25.89 million. 

Total nickel =$40.54 million x 65% ( allowing the 35% BHP offtake agreement)= $24.93 million less the $35/ton conversion fee = TOTAL $26.31 million 

B) For the last quarter we have 180 payable tons (hedged) @US$13.52 = AUD$6.53 million

Balance of production 820 tons at the spot price. ( my guess US$23.00/lb , this month so far the average is US$22.79/lb)

820 tons at US$23/lb = AUD$50.6 million

Total April-June $57.13 million x 65% = $37.13 million – conversion fee 

Total = $37.1 million.

C)First half was $30.4 million

FY07 Nickel =$26.31 +$37.1 + $30.4 = $93.81 million

SO WE HAVE FY07 Annual sales of $93.81 million
FY07 EBITDA =$40 million (first 1/2 year $11.5 million)


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## Rimtalay (4 May 2007)

Manganese, 
using the Dec  ½ year report we have a production of 471,606 tons for a revenue of AUD$63.7 million = AUD$135/ton. In the March quarterly report Mr Baxter says that the increases in manganese prices will add 10% onto the FY07 revenue, just a tricky way of downplaying what is essentially a 20% increase , so using this increase AUD$135 x 10% = $148.50. If we use the yearly production target of say 910,000 tons we will have a 
total FY07 revenue of AUD $135.1 million.
less cash costs $2.25/dmtu =$108/ton
$108 x 910,000 = $98.2 million
EDITDA FY07 = $36.9 million ( half year $13.9 million)
2nd half is more than double due to huge increase in Mn price.


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## Rimtalay (4 May 2007)

Chrome ore, 
it was an excellent production result for the March quarter and therefore on target to produce 250,000 tons. If we use the Dec  ½ year report we have a production of 126,015 tons for a revenue of AUD$25.1 million = AUD$200/ton. In Mr Baxter’s March update and the March quarterly report he indicated a 6% increase in the FY07 revenue. Ie. AUD$200 x 6% = $212. If we use the production target of 250,000 x $212/ton we will have a total revenue of AUD $53 million.
WOW FY07 AUD $53 million for chrome ore
cash costs AUD$122.43 X 250,000 =$30.6 million
EBITDA =$22.4 million ( 1st half $9.8 million this was already a 42% increase)


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## noirua (4 May 2007)

Rimtalay said:


> Have you seen the Vote NO website
> ConsMin currently has $187 million in other companies in shares JML,BCI,MTH,RDR,VML that is 83c per share before we start on 200,000 tons of nickel at US$23/lb. ($12 billion) There is 30 million ton of manganese as they upgrade the resources and reserves with the new discoveries. Chromite is at an all time high, and what about Mindy Mindy iron ore.
> The bid will not pass without a price close to $3/share, we have some shareholders currently running all the numbers, I'll start posting them soon, once we get all the information, ConsMin could be looking at profit of $60 million FY07, thats a 10% return on investment on a share price of $2.67, that's almost unheard of.
> Hundreds of shareholders have contacted the Vote NO website and all but one person will vote NO, and the one YES vote did not leave their ID,I'm sure it was a Company Stooge, like Blue Bay Diver on ASF.




Hi, I must take up a point with you in the value of investments held by Consmin. There is no way you can value these at full market quotes. Like Investment Trusts and Funds these trade at a discount to asset value, for very many reasons, and I would put the value nearer 70 cents than 83 cents. 

Also, you just can't value nickel and manganese on the basis of it all being piled up ready for sale. 

When you say profit for 2007 being £60 million, is this before tax, after tax - EBIT, EBITDA etc., ??  Which ever way, the return is not really as exceptional as you portray, just good.

I agree the offer is too low and the cash element should be raised by about 30 cents. 

Good Luck in your fine efforts.


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## Rimtalay (5 May 2007)

NICKEL HIT ANOTHER RECORD  US$24/lb overnight 4th May 07  
Nickel May 04,13:24 
Bid/Ask 23.9867 - 24.1228 
Change +0.6660  +2.86% 
Low/High 23.3207 - 24.1908


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## Rimtalay (8 May 2007)

CHROME ORE STILL INCREASING

We are now seeing reports that chromium is trying to get into the act. India's decision a few months back to add an export tax, and South Africa's clamp down on shipments of chromite ore, has forced China to scramble for supply. This had led to spotty shortages in Europe and North America, which in turn, has led to price increases.


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## Rimtalay (8 May 2007)

ConsMin sales and profit calculations - done by a group of shareholders
http://www.usail2.com/consolidated_stephen_thomas_garbage.htm
Shows a EBITDA of $113.66 million FY07 
Final Dividend 8.25c/share minumum


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## Rimtalay (13 May 2007)

*Battle Line For Sales Of Manganese Ore To China Becomes Abnormal *
Tex report - subsciption issue-
= Spot Price Of Mn-Ore Has Risen To US$4.00 Per Mn 1% CIF, Anxiety For Shipments Of Ghanaian Ore  
Spot price of manganese ore for China has risen steeply. It seems that the contract on high grade manganese ore ( with Mn 46 - 48% ) has been concluded at a higher price of US$4.00 per Mn 1% CIF China. The origin of this manganese ore is said as Australian ore.

The normal level of price for high grade manganese ore contracted with Chinese customers for shipments in April - June quarter of 2007 is in the range of US$3.70 - 3.80 CIF but these prices have risen to a considerable extent in comparison with US$2.80 - 3.00 CIF settled for shipments in January - March quarter of 2007.

On the other hand, Ghana has sold 584,000 tons of manganese ores for shipments to China in 2007 but an anxiety for shipments from Ghana has emerged. The buyer concerned said that Privat, having acquired the new ownership of manganese mine in Ghana ( Ghana Manganese Company ), notified the parties concerned to cancel the existing contracts. Therefore, the transitions to be seen hereafter are marked and a possibility to reduce the quantity of manganese ore to be exported from Ghana to China is not deniable, because Nikopol Ferro-Alloy Works of Ukraine, under management of Privat, is a major buyer of Ghanaian manganese ore ( imported 830,000 tons from Ghana in 2006 ). 

The matter in question is that China imported 6,212,000 tons of manganese ore in 2006, which had a remarkable increase of 35% compared with that ( 4,580,000 tons ) imported in 2005. The averaged unit price of manganese ore imported into China in 2006 was US$104 per ton CIF as fallen from that ( US$149 ) in 2005. The reason, why the unit price of manganese ore imported into China in 2005 had risen to a nearer level to US$150 per ton CIF, was due to an aftereffect of the contracts concluded at a higher price than US$5.00 per Mn 1% CIF in 2004, when transactions to import manganese ore became a boom.

There is a strong possibility to materialize again an era of manganese ore in 2007 as recorded in 2004 to 2005. Namely, a tight supply of manganese ore is anticipated. As regards the world output of manganese ore in 2006, the production of high grade ore increased by 5% from that in 2005 but that of medium and low grade ores had a considerable decrease from that in 2005. Consequently, the total quantity of manganese ores produced in the world for 2006 came to 11.8 million tons ( on Mn content base ), having increased by only 2% compared to that for 2005. However, the world demand for manganese ore in 2006 increased by 4% from that in 2005 and this expansion of the demand complied with the world output of crude steel in 2006, which came to 1,314 million tons as increased by 3% compared to that in 2005.
As for the quantities of manganese ferro-alloys produced in the world for 2006, the production of silico-manganese increased by 17% and that of ferro-manganese also increased by 4 - 9% in comparison with those for 2005 and, in view of the matter which the world production of crude steel in 2007 is expected to continue a further expansion on a basic tone, the world demand for manganese is still in the direction to enlarge further. Therefore, the world demand for manganese ore in 2007 is anticipated to increase accordingly. On the other hand, by taking into account of price of US$5 per Mn 1% for manganese ore, the production of manganese ore in 2007 is supposed to turn to increase ( mainly to resume operations at idled manganese mines and to challenge again sales for exports ) but there is a big probability to arise a mismatch between supply and demand,

China is the country to face straightly a gap between decreasing supply and increasing demand. China produced 420 million tons of crude steel in 2006, having increased by 65 million tons from that in 2005, but is supposed to increase further their production of crude steel in 2007 by 50 - 60 million tons. Therefore, China will require more than 7 million tons per annum of manganese ore in 2007. The domestic production of manganese ore in China once reached a peak in 2005 but, after that, has inclined to decrease and the official data reported that the domestic production of manganese ore in 2006 had a decrease of 8% compared with that in 2005. Even the domestic production of manganese ore in China has arisen with a decline. 

The quantity of manganese ore required by China in 2006 had an increase of approximately 20% on Mn content base but the demand for manganese ore from European countries and the USA in 2006 had a considerable decrease of more than 20%. Accordingly, an increase of the demand in China was offset by a decrease of the demand in the western countries and a margin to maintain a balance still existed. In addition, the accumulated stocks of manganese ore at wharfs ( supposedly more than one million tons ) caused by an excessive quantity of this ore imported into China in 2005 had functioned as a buffer for the sharply increased demand for manganese ore.

The price of manganese ore for China had still weakened in the first half of 2006 and that of medium grade ore ( including siliceous ore ) had been depressed to a level of US$2.20 - 2.30 per Mn 1% CIF China. In addition, ocean freight has risen steeply and, consequently, net price of manganese ore received by manganese mines was a loss for them. As a matter of fact, medium-class manganese mines in Australia suffered from a loss in their settlement of accounts for the first half of 2006.

When the supply and demand of manganese ore on a long run are looked over, the projects to increase production and to develop new mines are scarce. The projects to increase production of manganese ore have been restricted to the followings ; <> BHP Billiton's mine in Australia ( to increase from 3.20 million tons / year at present to 4.20 million tons / year in 2009 ), <> Eramet's mine in Gabon ( to produce 3.50 million tons / year in 2008 by an increase of 500,000 tons / year from that in 2006 ), <> Ghana Manganese Company's mine in Ghana ( to increase by 200,000 - 300,000 tons / year to 1.80 million tons / year in 2007 by means of improving the facilities at loading port ) and <> Local mine of northern territory in Australia launched to produce from autumn of 2006 ( on a scale of 500,000 tons / year ).

When price of manganese ore enters into an era of US$5 per Mn 1%, the Buritirama mine of Brazil ( to produce 500,000 - 600,000 tons / year ), having had once disappeared from the supply side in 2005 to 2006, has a possibility to resume the production but the quantity of manganese ore to be supplied by this Brazilian mine has been limited.

On the other hand, in order to cope with the difficulties to secure manganese ore, the Central Government of China is very likely to start out to control exports of manganese ferro-alloys from China and has already adopted from April of 2007 the system to set up floor prices for exports of manganese ferro-alloys in line with the regulations.  
last modified : Tue 08 May, 2007 [11:05


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## Rimtalay (15 May 2007)

From the Metalsplace  - subscription only
Manganese ore shortage may hit steel production
The domestic steel industry's plan to scale up production to 60 million tonnes by 2010 may take a hit as India is running low on key resources used in steel-making such as high grade manganese ore (with low phosphorus content) and ferro manganese ore.

The mining industry anticipates a huge demand-supply gap in manganese ore in the coming years. Both grades of manganese ore have separate uses in the steel industry. While the high grade manganese ore with low phosphorus content is one of the primary raw materials used in steel making, the ferro manganese ore goes into the production of ferro-alloy, which is another ingredient of steel making.

Ferro-alloys are used as alloying elements in the production of steel for modifying strength, ductility, hardness or corrosion resistance and to remove unwanted impurities such as phosphorous and sulphur. The ferro-alloy usage varies depending on the category of steel being produced.

"The reserves of high grade manganese ore with low phosphorus content are extremely low, while the ferro manganese reserves are around 27 million tonnes. The Indian steel industry will experience serious shortage of both grades of manganese ore in the next five years since manganese mining has not been promoted extensively in India," S B Chauhan, advisor to the Federation of Indian Mineral Industries (Fimi) told Business Standard.

If India has to produce 60 million tonnes of steel by 2010, the requirement of manganese ore will be 2.71 million tonnes. At present, the manganese ore production in the country is around 1.92 million tonnes (including all grades). The steel output is around 47 million tonnes annually.

The total proven manganese ore deposits (including low grade, medium grade and high grade) in India is 104 million tonnes spread over Orissa, Karnataka, Madhya Pradesh, Maharashtra, Goa and Andhra Pradesh.

The public sector undertaking Manganese Ore India (MOIL) accounts for up to 60 per cent of the overall manganese production. During 2006-07, MOIL produced 611,000 tonnes of ferro manganese ore.

"If MOIL optimises production, it will not be in a position to meet the demand for both high grade ore and ferro manganese ore in 2010. If the Indian steel companies have to meet the projected production (60 million tonnes), they have no option other than importing manganese from South Africa, which has 80 per cent of world's manganese deposits," Chauhan pointed out.

Fimi has already appraised the government of the situation. "The government should promote the recovery of manganese ore by beneficiation and sintering.Exploration efforts must be intensified to find additional reserves of high grade ore," Chauhan said.

India produces low grade manganese ore, which is in demand in China. Low grade and medium grade manganese ore has usage in dry battery as depolarizer, paints, ceramics and micro nutrients.

There are a number of private mines that extract and export low grade and medium grade manganese ore to China, Pakistan, South Korea, Bangladesh, Japan and West Asian countries. But exports are very low, around 2.5 lakh tonnes per annum.


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## Rimtalay (16 May 2007)

ConsMin, they are NOW doing deals at US$4.00/dmtu CIF China and at 48% Mn this means US$192/ton. Shipping price from the Port Hedland to China now stands at US$35/ton. So FOB is US$157/ton or AUD$191.50/ton FOB
Cash costs from March Quarterly report AUD$2.25/dmtu or $108/ton. PROFIT $83.50/ton.
Production 910-920,000 FY07, and expected production of 960,000 tons FY08 = PROFIT $80.1 million.
If it goes to US$5.00/dmtu the profit goes to $137.7 million.
What about chrome ore and nickel.


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## Rimtalay (16 May 2007)

TEX report subsciption-

Price Of Chrome Ore For China Rises Steeply To Higher Level Than US$400 / Ton CIF 
= Following A Sharp Rise Of Spot Price For High Carbon Ferro-Chrome 
Owing to the increasing demand for chrome ore in China, the prices of chrome ores to be sold to China are rising steeply. According to an information from China, the price of medium grade lumpy chrome ore with 42% of Cr2O3 contracted to import into China, before the May Day in China started, had risen to US$370 per ton CIF but the new price of this grade chrome ore, as offered after the May Day was over, has risen further to a level of US$400 per ton CIF China.

Also, a level of the price for high grade chrome concentrate with 48% of Cr2O3 as contracted with China has already risen to US$420 per ton CIF China, having exceeded a level of US$400 CIF. The origin of this high grade chrome ore is said as an European product but supposedly specified to be Turkish chrome ore. 

The transactions with Chinese importers on chrome ores have been concluded up to shipments by the end June of 2007 but, as of April of 2007, the standard levels of prices for metallurgical grade chrome ores contracted with Chinese importers for shipments from European sources are <> lumpy ore with 42% of Cr2O3 at US$370 per ton CIF, <> lumpy ore with 38% of Cr2O3 at US$360 CIF, <> lumpy ore with 32 - 34% of Cr2O3 at US$290 CIF and <> chrome concentrate with 48% of Cr2O3 at US$420 CIF. A sharp rise of ocean freight has accelerated to soar price of chrome ore ex. European origin. 
*
The current price of chrome ore offered from Western Australia, being near to China, is US$240 per ton CIF China for medium grade lumpy ore with 42% of Cr2O3 ( with Fe /Cr ratio of 1 : 1.5 ). This Australian chrome ore has been already contracted with Chinese importers for shipments in April - June quarter of 2007 but a small quantity of this chrome ore has been still left at the mine and the negotiation on sale of this lot is being taken place.*

China has now become the largest country in the world to import chrome ore and has been still increasing the demand for chrome ore. Consequently, the supply situation of chrome ore has continued to be tight and many inquiries for chrome ore have been placed by Chinese importers before main producing countries of chrome ore in the world. The background of this aspect is that China is scheduled to produce 7.00 million tons of crude stainless steel in 2007. Therefore, it is certain to increase the consumption of chrome unit in China and spot price of high carbon ferro-chrome has risen to a higher level than US$1.00 per lb. CIF.

A trigger for this steep rise of prices for chrome ores is that the Government of India has decided to impose newly the duty of US$44 per ton on exports of Indian chrome ores, effective from the 1st March of 2007, and also risen the floor prices for exports of chrome ores from India. Furthermore, the Government has dropped a hint to control quantities of chrome ores to be exported from India.


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## Dutchy3 (16 May 2007)

Hi Rim and all

And now we have BIG WHITE NEW AIR ... volume not need to be an issue as the spike in Oct 06 can power advances from here. Load up, STOP's in the 2.25 ish range (will not be triggered)

Bit easy this one ....


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## kooka873 (17 May 2007)

*CSM - Consolidated Minerals - Take Over*

Hi folks,

I've just joined this forum - my virgin post.

I have been a holder of CSM for over 5 years.
For the first time I am a little concerned about this stock - with the take over offer of February 2007. The value is far too low in my unprofessional opinion.

It is my hope that the rest of the shareholders reject this offer.

It was mentioned in the News release to the ASX in February that by April 2007, shareholders would receive an independent valuers report on the value of this stock etc. I haven't received any further communication - has anyone else?

We are now in May & an announcement from the company I presume is close.

With the price of around $2.70 I am wondering if I should sell now, later or wait for a while to see what happens, certainly I would be unhappy at the proposed offer.

I have been pondering about Mr Baxter's management of CSM since Michael's departure from the helm of CSM. Michael did such a wonderful job.

I would welcome comments from interested CSM forum followers.

Kooka873


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## Dutchy3 (17 May 2007)

Hi Kooka ... the pain is over, selling now is not something I'll be doing. I'm an ex beanie and also use TA to enter and exit postions. The TA on this one is as good as it's been since late 2003 in terms of my expectations of the SP increasing.


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## Rimtalay (17 May 2007)

Hi Kooka, don't worry they won't get it past the post at $2.28/share.
Hundreds of shareholders are fighting this one, I don't think the management realised how many shareholders would be against the takeover.
Check out the Consolidated Minerals takeover VOTE NO website
Price for manganese and chromite are up. If you want the latest commodity industry reports fill out the feedback form  on the website and ask for them. They cannot be posted here, I would be sued.


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## kooka873 (17 May 2007)

Hi Dutchy3 & Rimtalay,

I greatly appreciate your feedback & material on this stock.

I am greatly encouraged by your support & the increasing share-price.

Rumour has it that an announcement is due for June, with voting maybe occurring in/around July.

I suspect/hope your right that shareholders reject this offer, it really is an insult.

It "appears" that the Noble group still hold (or did) close to 6% of this stock. 
Yes lets hope that the institutional investors look long-term & reject this offer. It wasn't that long ago that that this stock achieved the $4 mark & apart from the last divided payout or two(?) it provided great dividend payout yields in recent times. Given your information with demand for Manganese climbing & Nickel achiving great prices, your right CSM's value should continue to climb.

Interesting noting ABC TV's financial report about the very high PE ratio noted on many of China's stock market stocks, looks like that's headed for a correction in the not-to-distant future. Still it shouldn't hurt prices long term or effect Chinese demand for resources.

Cheers

Kooka873


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## Sainter (18 May 2007)

Howdy Kooka,
You could argue a high PER indicates high growth prospects. On that basis commodities will continue to be sucked in by China, to our benefit. Chip Goodyear strongly believes in the commodities supercycle, and given the privvy position he is in, that's good enough for me!

In my opinion, these guys overshot when they got to $4 a few years back, (due to 3 things-a high Mn price, V. profitable hedging at 55c or so, and the Portman windfall) and in hindsight I should have sold more than my 1/4 holding at the time (had bought for 60c, sold 1/4 at $3.99). As it is, I really see these things now genuinely being worth $4+ if they can get their Ni division firing and commodities hold up okay. Brokers will always put in conservative future values for commodities, but it seems in the past few years they've done nothing but revise those upwards! 

Cheers!


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## Rimtalay (19 May 2007)

Price of chromite is still increasing. I have all the latest Commodity Industry reports, but I cannot post them here. email info@catamaransaustralia.com and ask for them and I'll email them to you.

This is the latest Corporate news -subscription only - so I'll post the whole story.
*
Shortage of chrome ore further hits steel makers*
*Already reeling under soaring nickel prices, steel firms are demanding govt block exports of chrome*

India’s estimated Rs20,000 crore stainless steel industry, already reeling under the effect of soaring nickel prices in the global market, is now facing shortage of another critical input, chrome ore, with the mineral’s largest producer in the country, Tata Steel Ltd, stopping supply from 1 April. 
“We have stopped selling chrome ore because we have invested in facilities for manufacturing ferrochrome,” said Sanjay Choudhry, corporate communications chief at Tata Steel.
Chrome ore is used to make ferrochrome, which goes into the manufacture of stainless steel. India has around 28 ferrochrome manufacturers who make the product for the stainless steel industry and for exports. 
A Tata Steel spokesperson said the company had stopped exports of chrome ore, but did not comment on supplies to domestic ferrochrome makers.
“We are against the export of the country’s non-renewable natural resources without adding any value to them,” said Choudhry. “On this basis, we have stopped all our iron ore exports a couple of years ago and the same position exists for chrome ore.”
Tata Steel, which also manufacturers ferrochrome and globaly trades in the product, said that it would continue to sell chrome concentrate, made from low-grade ore. 
The floor price of chrome concentrate is $347 (Rs14,227) a tonne, just $3 less than ore prices. Chrome ore (and concentrate) prices have grown 75% on the back of strong Chinese demand; China is the world’s largest consumer of stainless steel.
The increase in price, coupled with high power costs, will hurt ferrochrome manufacturers, analysts say. “Unless a company has captive chrome ore and coal mines to generate power, the ferrochrome business is commercially not viable,” said Manish Joshi, metal analyst at Karvy Consulting Ltd. Power typically constitutes 40-50% of the total cost of production of ferrochrome makers.
Blocking exports
On 1 March, the government levied a Rs2,000 surcharge on exports of chrome ore and chrome concentrates.
In the nine months to December 2006, until when data is available, Tata Steel exported 79,500 tonnes of chrome ore, down from 173,950 tonnes in the preceding 12 months. It shipped out 402,459 tonnes of concentrate, compared with 466,650 tonnes previously.
Tata Steel currently has three ferro alloy plants with a total capacity of 140,000 tonnes in Orissa, producing about two lakh tonnes of ferro chrome and five lakh tonnes of chrome concentrates. It has appointed two companies””Ferro Alloys Corp. Ltd and Nav Bharat Ventures Ltd””as conversion agents, to whom it will provide chrome ore to convert to ferrochrome for a fee.
With Tata’s supply out of reach, the Indian Ferro Alloys Producers’ Association, which represents the industry, is now demanding that the government stop export of chrome ore, a rare mineral with limited proven reserves within the country, 90% of which are located in Orissa.
“We must conserve the mineral in the country,” said T.S. Sundaresan, secretary general of the association. 
The association has also written to mining, steel and commerce ministries to intervene on its behalf with the state-run Orissa Mining Corp. (OMC) to step up chrome ore production.
Apart from Tata Steel, OMC is the second-biggest chrome producer in the chrome-rich Sukinda valley. It sits on the largest reserve of 6,000 hectares. Tata Steel, which had a reserve of 1,200 hectares, saw its mining area reduced to 406 hectares after a 1998 Supreme Court order based on the Sharma Committee report.
The carved-up areas were parcelled off to four companies for captive consumption, Jindal Stainless Ltd, Ferro Alloys, Balasore Alloys Ltd, and Indian Metals & Ferro Alloys Ltd.
India currently accounts for 2% of the world’s proven chrome reserves, 44 times less than the world’s largest chrome ore producing nation, South Africa, but exports more than that country.
Looking to Orissa
Some stainless steel makers are now pinning their hopes on OMC, which exported 190,000 tonnes of chrome ore and 160,000 tonnes of chrome concentrates in the last financial year. But companies located outside the state fear that Orissa’s policy of making sure 70% of its chrome ore is used within the state will curb supplies to them.
“Because of chrome ore shortage, prices of ferrochrome have risen sharply,” said Dilip Singh Lodha, CEO of Jodhpur-based Stainless India Ltd, which produces 5,000 tonnes of stainless steel a month.
Kolkata-based Rohit Ferro-Tech Ltd, which has two plants in Orissa and West Bengal, complained that it is 30% short of requirement and has stock to last only three months. “Increasingly, it’s going to get tougher to access chrome unless the supply from Orissa goes up,” said Rakesh Aggarwal, president (commercial) at Rohit Ferro-Tech.
Other companies such as SAL Steel are also finding the going tough. A subsidiary of the Sal Steel Group, it had set up a 6,000 tonnes a month ferrochrome plant a year ago in Gujarat’s Kandla port, primarily to take advantage of the 16% excise and 4% tax benefit in the state.
Now, the company, which posted a turnover of Rs275 crore last year, faces uncertain supply. “We have little choice, but to import now,” said Sujal Shah, director (purchase). “The countr must ban export of chrome and supply it to domestic consumers instead,” he added.


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## Rimtalay (22 May 2007)

*South Africa: Strong Demand Cranks Up Spot Ferrochrome Prices*
http://allafrica.com/stories/200705210246.html
Business Day (Johannesburg)

21 May 2007
Posted to the web 21 May 2007

Charlotte Mathews
Johannesburg

SPOT prices for ferrochrome, of which SA is the single largest producer in the world, are running well ahead of contract prices, a promising indicator for local producers about to enter negotiations for third-quarter contracts.

SA's three major ferrochrome producers are JSE-listed Merafe Resources, which is in a joint venture with Xstrata; Samancor Chrome; and Hernic Ferrochrome. A third company, London AIM-quoted International Ferro Metals (IFM), is ramping up production at its integrated chrome mine and smelter in Mpumalanga.


Tata Group started construction of a R700m ferrochrome smelter in Richards Bay late last year, in which it will initially use Indian ore.

Ferrochrome is mainly used as an additive to stainless steel to prevent corrosion. It is also added to other steel alloys to increase hardness. London-based Numis Securities analyst John Meyer said in a note to clients last week on IFM that spot prices for high-carbon ferrochrome were 92c-98c/lb against current contract prices of 83c/lb.

At the beginning of last year ferrochrome prices dropped as low as 65c/lb as a result of market surpluses, which came in the midst of expansion programmes by all SA's leading producers. The Xstrata-Merafe Chrome joint venture has invested R1,67bn in the first phase of Project Lion, an integrated chrome mine and ferrochrome smelter near Steelpoort; Brits-based Hernic Ferrochrome expanded its capacity to 420 000 tons a year at a cost of R450m two years ago while Samancor Chrome is in the midst of a three-stage, $1,5bn expansion programme at Steelpoort. Merafe Resources financial director Stuart Elliot agreed yesterday that spot prices were higher than contract prices and new contract prices generally took their lead from spot prices. But he added that price negotiations for the third quarter would start shortly and he would prefer not to conduct those negotiations through the media.

Hernic Ferrochrome chief financial officer Hannes van Dyk said the higher spot price could be an indicator of a higher contract price in the third quarter.

Elliot said there were various reasons for the strong spot price but it essentially reflected demand outstripping supply as there were huge increases in stainless steel production in China, for uses ranging from domestic appliances to the building and automotive industries. Meyer said ferrochrome was reported to be critically short in Europe, with limited supply from Kazakhstan, SA's main competitor.


The Xstrata-Merafe joint venture has 20 furnaces, of which two have been temporarily closed. A decision would be made later this year on whether to bring them back on line, Elliot said. Van Dyk said Hernic had four furnaces, all of which were running at 100% capacity. Hernic had just completed an expansion programme and had no immediate plans to expand further, but if demand continued to be as strong as it was at present, Hernic could consider this.

Meyer noted the strengthening of the rand against the dollar, which was negative for margins for South African producers. But he said the strengthening in the ferrochrome price looked sufficient to compensate for the exchange rate.

Samancor Chrome could not be reached for comment on the price or its production capacity.


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## kooka873 (22 May 2007)

Thanks Sainter & Rimtalay for your informative msgs.
Great to see the demand for Chromite at present levels & SP holding at present value...

Kooka


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## Rimtalay (23 May 2007)

Story on Ferro-chrome subscriber story

* * *Charge chrome producers moot 18-20 cents rise in Q3* 
London*21 May 2007*15:26 Charge chrome producers are determined to close the gap between the contract price and spot price of their product in the forthcoming third-quarter contract negotiations, with some producers saying that they want the two prices to be completely on par, implying an increase of at least 18-20 cents. Charge chrome contract negotiations for the third quarter are set to start in earnest in two to three weeks ’ time, producers told MB, adding that they will seek a hefty increase in the list price for the second consecutive quarter. “ The price difference between the spot market and contracts is huge, ” said an official at a large South African producer, referring to the spot price of high- carbon ferro-chrome of $0.98-1.08 per lb, compared with the second-quarter contract settlement at 81-83 cents. The spot price started rallying from 65-68 cents at the start of the year only after the second-quarter contracts were settled, as ferro-chrome suddenly became in short supply amid booming demand from China. “ It is clear that the consumers are getting an unreasonably cheap deal in the current market, with contract prices that are far below the spot price, and then they all get percentage discounts on that price as well, ” the official said. “ This is while ferro-chrome producers are scrambling to get their hands on more ferro-chrome just to be able to supply the orders on their books, ” he added. A second producer agreed, saying that Chinese consumers "are screaming for material. The demand from China is excessive". "At the same time, we are all short of ferro-chrome," he continued. "I am having to turn down orders." The producers said the International Chromium Development Association (ICDA) meeting in Beijing last week showed consensus among charge chrome producers for a further steep price increase. “ Everybody who is important was there, including the top consumers, ” said the first producer source. “ We all talked like gentlemen and we told the consumers that they have to take into consideration that the contract price is substantially below the spot market and that on top of that the consumers get their percentage discounts. It cannot go like that. ” *
The second producer source said in the third quarter South African producers have higher electricity costs because it is the height of winter in the country. Freight costs in South Africa have increased, and the second-quarter 6-8 cents contract rise was basically wiped out after the rand strengthened against the dollar. "I will be looking for a 20 cents increase," he said. "I have no doubt there would be baulking from the large consumers, but at the end of the day the increase won't have a large impact on the ferritic [non-nickel] grade stainless steel." Even as European and US stainless steelmakers talk about production cuts while the market is in a destocking phase, the charge chrome producers argue that the stainless producers in these countries are destocking the commodity stainless nickel-bearing grade 304 stainless steel, and are indeed expanding production of the non-nickel grades. “ The ferritic [non-nickel] grades still use a lot of ferro-chrome, and if they ’ re expanding production, it means increasing demand for ferro-chrome, ” said a third producer source, adding that unlike nickel, there is no scrap substitute for ferro-chrome. Also, he said, the increase in demand from China will more than offset a decrease in the USA and Europe. “ China can take any quantity that might be available, but nobody has surplus, ” said the first producer source. He added that one non-South African producer has been talking about contract prices of $1.15-1.20, but this could not immediately be confirmed. “ We are not unreasonable, but would want the benchmark price to be equal or around the spot price, ” said the first producer source. “ I would like to see an 18 cents increase, which one could argue is a bit too much, but not if you consider that the 18 cents is not really 18 cents. The consumers get their discounts. ” A fourth producer said his peers at the ICDA were all singing from the same hymn sheet. They all agreed the third quarter would see another big increase, but his estimate for an increase was a tad more moderate at 8-10 cents. “ Everybody is looking for ferro-chrome – there is a huge shortage, ” he said, adding that large players like Xstrata and Hernic have all asked him for extra units. “ There is a huge shortage among producers, and I can ’ t see anyone in this market being aggressive, not even the new guys, not in a strong producer market like this, ” said the second producer source. However, the large western consumers will have to be convinced to dig deeper into their pockets in the third quarter, producers acknowledged. “ The consumers heard us out, but as usual they had a wait-and-see attitude, ” said the first producer. “ It will be really important for the South Africans to hold their nerve and be disciplined in the upcoming negotiations. At the moment we are all saying the same thing but it will only really count when it comes to the crunch. ”


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## Rimtalay (25 May 2007)

* *  Manganese flake closes in on $5,000 on panic buying *
London*23 May 2007*14:43 
Manganese flake seems unstoppable as consumers are panic-buying, causing the price to leap another $200-400 with offers now exceeding $5,000 per tonne. Flake is now selling at $4,000-4,500 per tonne, up from $3,600-4,100 previously, as consumers buy in fear of being unable to clinch the supplies they need amid booming demand and a perceived shortage of material, following the arrest of material in Rotterdam. “ The manganese flake market has been upside down for the last six months, ” said a European trader, adding that offers for prompt material in Rotterdam are in the $5,200-5,300 range, while material for shipment is now on offer at $4,750-4,800 per tonne. “ We haven ’ t seen any relief, ” he continued. “ We expected the export tax from China might increase in the announcements yesterday; it didn ’ t. I initially thought it would bring some sanity to the price of flake; it didn ’ t. Nothing has changed. People are waiting for a second round of export tax announcements with manganese included in that. ” A manganese ore producer told MB that concerns over ore availability has caused consumers to panic about getting their share of orders on any manganese products. “ Customers are worried about supplies and they are willing to settle at almost any price for their manganese products, ” said the producer source. A second trader said he hope some stability would come back to the market, but added he did not see that happening until the uncertainty about additional export tax on the metal from China is exorcised. “ Until the export tax anxiety lifts from the market, we will see continuing rising prices, ” he said. Manganese lump prices are also rising and trading at a $200 premium to flake, market participants reported. Copyright  © Metal Bulletin PLC. All rights reserved.
*


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## Rimtalay (25 May 2007)

18 May 2007
*India: Curbs sought on chrome ore exports*
Anticipating a shortage of chrome ore, a crucial ingredient in stainless steel production, in the coming years, the mining industry wants the Union government to re-examine its export policy. 

India is the third largest exporter of chrome ore after South Africa and Kazhakstan, though the reserves constitute only 0.84 per cent of worldwide reserves. 

Recently, the government imposed a duty of Rs 2,000 per tonne on exports of all grades of chrome ore to curb overseas sales. The price of Indian chrome ore in the international market ranges between Rs 6,000-10,000 per tonne, depending on the grade. 

“However, all the chrome ore mining firms and exporters have absorbed the tax since the price of chrome ore is high. There will be a huge demand-supply gap in the coming years if the exports of chrome ore are not curbed. We have urged the government to allow exports of chrome ore concentrates (produced through beneficiation of low grade chrome ore) and conserve other grades of chrome ore,” S B Chauhan, advisor to the Federation of Indian Mineral Industries (FIMI), told Business Standard. 

China is the principal market for Indian chrome ore. Nearly one-third of the demand for chrome ore from China is met by India. Last year, India exported 1.34 million tonnes (accounting for 31 per cent of imports) of chrome ore to China. Chrome ore from South Africa and Turkey accounted for 18 per cent and 17 per cent of the Chinese imports. 

The demand for Indian chrome ore is likely to go up this year since China intends to increase its stainless steel output by 37 per cent to 7.35 million tonnes this year. 

The proven chrome ore reserves of all grades in India is around 66 million tonnes, with Orissa accounting for the bulk followed by Karnataka. The recoverable reserves of metallurgical grade chrome ore are around 50 million tonnes. 

“We anticipate fast depletion of chrome ore at the open cast level in the coming years since Indian companies do not have the technology to undertake underground mining. There will be hardly any chrome ore of metallurgical grade available in the country if exports continue to remain at the present level,” he pointed out. 

Besides, many public sector undertakings (PSUs) have control over chromite bearing areas in the country. “These areas are lying idle without witnessing any exploration and development. Considering the alarming status of metallurgical grade chromite resources in the country, the idle chromite-bearing areas should be de-reserved,” Chauhan said.


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## Rimtalay (26 May 2007)

Friday 25 May 2007 
*Chinese SiMn gains further as ore shortage persists*
BEIJING (Metal-Pages) 25-May-07. Chinese silico-manganese prices have broken through the $1,450/tonne level in a sellers’ market where the strong demand and manganese ore shortage are showing no signs of easing. 

Export prices for standard 65/17 grade material are around $1,450-1,500/tonne FOB, up $250 compared to one week ago. The market was at either side of $860/tonne before the weeklong holiday at the start of this month.

Domestic prices have peaked at Rmb9,600-10,000/tonne ($1,255-1,307) ex works. The country’s largest carbon steel mill Angang Group doubled its purchase price /subscr/story.php?id=27641 recently with the purpose of ensuring consistent supply. 

“There is strong demand both domestically and internationally,” one silico-manganese trader told Metal-Pages today. “The continued growth of global steel production has increased demand for alloying metals.”

The tight availability of high grade manganese ore has also helped thrust the market. “There isn’t enough supply for ore out there as no large overseas shipments seem to be arriving,” a second trader said. “And it’s a real burden for alloy producers that spot ore prices are at historical highs.”

Spot market for imported lumpy ore (Mn min 48%) has proven far more volatile with prices having surged to Rmb62-65/mtu from Rmb50-52/mtu seen one week earlier. Despite the current strong fundamentals there are concerns that the market could turn around when the supply increases.

“The output for manganese is typically sufficient in the summer,” a manganese producer told Metal-Pages. “And the current good price may have encouraged some companies to shift their furnaces to silico-manganese.”

Silico-manganese previously hit a record Rmb10,000/tonne in early 2004 on an unprecedented steel boom while prices then halved rapidly on oversupply when new production came on stream.


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## Rimtalay (27 May 2007)

* * *(AMM) Ore shortfall in China keeps pressure on ferromanganese*
 New York*17 May 2007*19:45 
U.S. ferromanganese prices are climbing at a dramatic rate as a manganese ore shortage in China continues to underpin worldwide supply tightness. "China has no manganese ore at a high grade, so they are forced to import manganese ore with a higher grade and blend it in with their low-grade ore to produce manganese that can be used in alloys," a trader said. Prices for manganese alloys have soared on the back of the ore shortage. High-carbon ferromanganese is now trading hands in the United States for between $1,050 and $1,125 per long ton, up from $980 to $1,040 per ton previously. Medium-carbon ferromanganese has jumped to between 82 and 86 cents per pound from a previous range of 78 to 80 cents per pound. One trader reported the recent sale of several truckloads of medium-carbon ferromanganese at 85 cents per pound. "Manganese ore prices are through the roof in China, so once any material makes it to the U.S., prices are well over $1,000 (a ton)," a second trader said. Users who are staying out of the market in the hope that prices will fall could be waiting a long time, sources said. One reason: China is expected to raise the export tax on ferroalloys to 15 percent from 10 percent, and an announcement could come as early as Monday, traders said. "In the next 30 days every unit of manganese will be 30, 40 or 50 percent higher," the first trader said. "We're going to see high's you've never seen before." On Wednesday, the U.S. Defense Logistics Agency released a basic ordering agreement tender for the sale of 10,000 tonnes of high-carbon ferromanganese. The results of the tender will not be known until early June. A pair of traders said they expect Glencore Ltd., U.S. arm of Glencore International AG, and BHP Billiton to make a strong run for the material. *


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## Rimtalay (27 May 2007)

*Manganese ore price lifts to highest level since Sep 05 *

London  25 May 2007 15:41 

Manganese ore spot prices have jumped to levels last seen in September 2005 on supply disruptions at many major producers, while demand for ore has been holding unabated, market participants reported. Manganese alloys in Europe have been pushed up by the rising cost of ore, following similar trends in the USA and Asia . Manganese ore 48/50 percent manganese is now trading at $3.30-3.60 per mtu fob on the spot market, compared with $3.10-3.30 previously. Most tonnages from large suppliers are secured on long-term contracts, but the spot market has revived as demand for the ore surged this year, mainly driven by China . “ The cause of all the drama in the manganese market has been coming from the very high price for ore because of the huge demand increase in China , ” a large ore producer told MB. “ But more important is that this has combined with significant disruptions in deliveries to China from almost all the major suppliers. ” He referred to bottlenecks at ports from which Eramet has been shipping due to electricity problems, reduced ore output at CVRD ’ s Azul mine, which will be exacerbated by the closure of the mine from June for six months, and reduced output from Ghana after the Ukrainian group Privat bought the mine. “ BHP is having problems and not producing as much as they want, ” added a second large producer source. “ All of these are conspiring to put upward pressure on ore prices. The spot market is going through the roof. ” A third producer source said Chinese traders are driving prices up even further by holding onto material, with reports in the market of prices as high as $5-5.30 per mtu cif. “ When the ore price increase, the alloy prices follow, ” said the third producer source. Indeed, the price for ferro-manganese and silico-manganese in Europe jumped to â‚¬800-850 ($1,076-1,143) per tonne delivered on both products, from â‚¬670- 705 and â‚¬700-730 respectively. Silico-manganese spot business has been transacted at levels over â‚¬900 per tonne, market participants reported. One silico-manganese producer reported achieving â‚¬1,000 in Europe .  

“ Steel demand is very strong in Europe , ” said a manganese alloys producer. “ We have customers asking for prompt delivery, but we struggle because we are full. ” He said the European price on ferro-manganese with 7.5 percent carbon and silico-manganese basis 65-75 percent manganese has risen by at least â‚¬50 in the past week alone. “ Had we spoken a week ago, the price would certainly have been lower. The market has taken all the fundamentals at play on board and has now just been propelled forward by momentum, ” he said. All the producers said the jump in the spot price bodes well for the third-quarter contract negotiations, which are due to start “ pretty soon ” . Copyright  © Metal Bulletin PLC. All rights reserved.


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## Rimtalay (27 May 2007)

MANGANESE ORE 48% CIF CHINA    -   PRICES FROM RYAN’S NOTES
DATE	RN 48% Mn Ore US$/dmtu LOW	RN 48% Mn Ore US$/dmtu HIGH
1 st May 07	                 3.20	      3.60
4th May 07	                 3.60	      4.00
8th May 07	                 3.80	      4.00
11th May 07	                 4.20         4.30
15th May 07	                 4.20	       4.30
18th May 07                          4.35	      4.60
22nd May 07	                 4.70         5.00
25th May 07	                 4.70	       5.00
Percentage increase   	    47%	     40%


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## Rimtalay (28 May 2007)

Ferro-chrome HC basis Cr 52% C 6-8% del'd N Eur dp 24-may-2007  0.94 - 0.99 $/lb Cr 
Ferro-chrome HC basis Cr 52% C 6-8% delivered USA 24-may-2007  0.98 - 1.02 $/lb Cr 
Ferro-chrome HC basis Cr 52% C 6-8% FOB China 24-may-2007  0.78 - 0.8 $/lb Cr 
Ferro-manganese 73% HC FOB China 24-may-2007  1380 - 1420 $/mt 
Ferro-manganese Mn 78% HC 8% delivered USA 24-may-2007  1060 - 1120 $/long ton 
Ferro-manganese Mn 78% HC delivered European works 24-may-2007  670 - 700 EUR/mt


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## Rimtalay (29 May 2007)

MERGERS AND ACQUISITIONS 
*ConsMin warms to Pallinghurst’s Investec link*
Australian resource company, Consmin, which has been the target of an approach by Brian Gilbertson’s Pallinghurst vehicle, feels that the bid may be back on track through the latter’s new tie-up with banker Investec.

Author: Ross Louthean 
Posted:  Tuesday , 29 May 2007 

PERTH -  

The West Perth-based miner Consolidated Minerals Ltd (ConsMin) has implied that the bid for the company by Brian Gilbertson's Pallinghurst Resources and North American mining associate AMCI may be getting back on track by welcoming those two bidding partners' link with Investec plc.

In a brief announcement today ConsMin's managing director Rod Baxter said it was "pleased" Investec has been invited by Pallinghurst and AMCI to "participate in the proposed transaction with Consolidated Minerals" first detailed by the West Australian manganese, chromite and nickel miner in late February.

"Further details on the implications of Investec's involvement in the proposed transaction will be provided in the Scheme booklet," Baxter said.

The draft scheme documentation for the proposal has been lodged with the Australian Securities and Investment Commission (ASIC).

However, Perth stockbrokers that Mineweb spoke to were of the view there would need to be a new carrot introduced by the Pallinghurst-AMCI-Investec party to excite ConsMin shareholders as the stock has lifted since the time of the late February bid from a range around $A2.00/share ($US1.66) to trading late today at $A2.94/share ($US2.44). 

On April 11 Mineweb reported that Gilbertson's bid for ConsMin had been holed, as the then stock price of $A1.63 ($US1.35) was considered above the Pallinghurst offer which was $A1.38/share ($US1.13/share) plus two shares in a new Consmin vehicle for every five shares held, with shareholders receiving a 40% stake in the new company. Pallinghurst wanted to achieve 50.1% ownership. At the time ConsMin's board supported the Pallinghurst bid, saying the transaction valued the company at an enterprise value of $A625 million ($US515), or at $A2.28/share ($US1.87/share).

The ConsMin share price has been on a solid climb since the bid, thanks in part to an improving price for manganese though the foundering bid has attracted the attention of others, and it has been reported in the Australian business media several times that big brokers UBS and Goldman Sachs JBWere were running the numbers on a counter offer.

Mining columnist John Phaceas of The West Australian said in his Spinifex column that Gilbertson would arrive in Sydney today to begin briefings with investors, institutions and the media to convince them of the merits of the Pallinghurst offer.

Phaceas said rumours suggest any rival offer may include splitting ConsMin's underground nickel mine at Kambalda from the open pit manganese and chromite mines in the Pilbara. One possible contender named by Phaceas is cashed-up Broken Hill zinc-lead-silver miner Perilya Ltd.

Yesterday a Johannesburg-filed statement said Pallinghurst, AMCI (interestingly through subsidiary AMCI ConsMin (Cayman) LP and Investec would become "Cooperation Partners" to pursue investment opportunities.

The agreement has earmarked $US200 M and the partners were in "advanced discussions with a leading Asian steelmaker on an additional commitment of $US100 M.

The statement also said Investec had been invited to join the bid for ConsMin


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## wintermute (29 May 2007)

What did others think of the announcement this evening?? Sounded like a bunch of waffle to me  

No mention of possibly increasing the bid, it almost sounded like they were planning to continue on without changing anything and still offer shareholders $2.28 per share (hoping that people would be impressed that they had another partner)... I must admit I've been extremely slack with keeping up with announcements lately, but this one certainly didn't seem to offer anything of substance to me!!

Tony.


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## noirua (29 May 2007)

Confirmation that Investec are to join Pallinghurst & AMCI in the bid for CSM, increases the buying power substantially.

At $2.94, the offer for CSM is valued at $2.55. The cash part of the offer at $1.38 appears set to be raised.


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## Col Lector (29 May 2007)

I imagine that there are quite a few other suitors for CSM. Perilya's mentioned, but Surely there are some others...eg, major steelmakers (Chinese particularly) that would love to secure control over Mn/Cr/Ni supplies.
If the CSM directors havent sold out already.
I am a bit cynical as to the inclusion of Investec, and the welcoming by the CSM honchos. Seems to be a bit of a South African club forming here. 
As in sport, we all know how the S.African's dream/strive and plot to get one  over the Aussies....


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## wintermute (29 May 2007)

noirua said:


> Confirmation that Investec are to join Pallinghurst & AMCI in the bid for CSM, increases the buying power substantially.
> 
> At $2.94, the offer for CSM is valued at $2.55. The cash part of the offer at $1.38 appears set to be raised.




Hmmm I think I need to do some calculations again... I guess that the total number of shares in the new company will basically be the same as the current number so market cap is market cap.... and the new shares should be worth the same as the old ones... so if I had 10,000 shares, I'd get 4000 shares worth $2.94 each, and 10,000 * $1.38 (ie $13,800 cash) making my investment worth $25560, but if I sold at market it would be worth $29,400!  

yes I think that the deal needs some tweaking  This was my argument from the begining, I bought CSM for the potential growth, not because of some takeover rumour (I actually didn't even know about the takeover rumour when I bought my first parcel)... buy giving me cash and 40% I'm being robbed of 60% of my potential growth!!

Tony.


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## Rimtalay (30 May 2007)

Hi Tony,
You are 100% right, you are being robbed of 60% of the growth and by giving Pallinghurst your shares for only $1.38 share you are effectively giving Pallinghurst 0.38 c / share of your profit for nothing.
Surely ConsMin shareholders aren't that stupid. 
If only a few more shareholders would email Rod Baxter and tell him they want more and that he is NOT looking after shareholder interests. I reckon $2.10/share plus 2 for 5 this would value the shares at $3.50 that would be fair and reasonable to shareholders.
Our ConsMin management think its a done deal. If you don't put pressure on now then we don't stand a chance.
email Baxter rbaxter@consminerals.com.au
Don't always leave the fighting to someone else. Help us


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## Rimtalay (30 May 2007)

This has just come out in the Sydney Morning Herald today.
It's a done deal already, unless we tell them now, they won't up the price after the VOTE

ConsMin bidder recruits allies
Jamie Freed
May 30, 2007
FORMER BHP Billiton boss Brian Gilbertson's $625 million partial private equity tilt at Perth miner Consolidated Minerals has gained additional backing from South African investment bank Investec and an Asian steelmaker.

As Mr Gilbertson began selling the ConsMin offer to investors and analysts in Sydney yesterday, his London-based fund, Pallinghurst Resources, said it raised $US200 million ($244 million) from private coalminer AMCI and Investec.

Pallinghurst added it was in "advanced discussions" with an Asian steelmaker - believed to be Korea's Posco - for another $US100 million.

In total, Mr Gilbertson expects to raise $US1 billion to $US1.5 billion to help pursue investment opportunities in the resources sector, including its bid for ConsMin.

In a statement, Investec chief executive Stephen Koseff implied his bank agreed to participate in part due to the corporate advisory fees it would gain from Pallinghurst's deal flow.

Mr Gilbertson has often been cited as the consummate mining dealmaker. He was the driving force behind BHP's $US30 billion merger with Billiton in 2001, but was later ousted after more acquisition plans - such as a tie-up with Rio Tinto - were deemed too ambitious by the BHP board.

His latest deal, the offer for ConsMin, has been controversial from the start. Pallinghurst has offered shareholders $1.38 in cash and 0.4 of a share in a rejuvenated ConsMin, in which Mr Gilbertson's group would own 60 per cent.

ConsMin shares yesterday closed 1c higher at $2.94, meaning the bid values the company at $2.56.

In an interview with South Africa's Business Day, Mr Gilbertson said ConsMin was attractive because its assets had been undervalued by the market.

Argo Investments managing director Rob Patterson yesterday morning deemed the bid price "obviously inadequate".

But after listening to a presentation by Mr Gilbertson and his associates in the afternoon, he was marginally more optimistic.

"There's no doubt they will bring quite a lot to the table," Mr Patterson said. "The problem we see is the transaction was priced quite some time ago when commodity prices were different. We'll wait and look at the documents now. The way we vote will depend on the circumstances."

The scheme of arrangement booklet should be released in mid-June, about two months behind the originally scheduled April release date.

Meanwhile, prices of the commodities produced by ConsMin - nickel, manganese and chromite - have performed strongly.

There have also been market rumours an independent expert report already submitted to the corporate regulator for approval might have valued ConsMin shares above the offer price.


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## Rimtalay (30 May 2007)

It sounds like our dear Chairman Mr Carter is accepting for us. Of course Baxter thinks it's great, he doesn't own a single share.
You need to email Baxter NOW and tell him to up the price , otherwise you vote NO. We need the price increased before we get the scheme documentation.

email rbaxter@consminerals.com.au

ConsMin buyer's $1.8bn war chest
Andrew Trounson and Kevin Andrusiak 
May 30, 2007 

FORMER BHP Billiton boss Brian Gilbertson has begun a whistle-stop tour of Consolidated Minerals shareholders, bringing a $US1.5 billion ($1.83 billion) war chest to sway investors on a proposed takeover of the miner.
Pallinghurst, Mr Gilbertson's private equity vehicle, has teamed with privately owned US coal miner and bid partner AMCI and South African bank Investec to build the fund, as Consolidated Minerals shareholders begin to get a taste of what their company could achieve through the a $625 million scheme of arrangement. 

If approved, Pallinghurst Investor - a mix of the three players - will take a 60 per cent stake in a vehicle dubbed NewConsMin, which will be used to house ConsMin and other acquisitions made with the $US1.5 billion. The other 40 per cent will be owned by ConsMin shareholders, who will also collect $1.38 for every share. 

No extra money from the fund has been set aside to boost the scheme of arrangement's value. 

Draft scheme documents have been lodged with the Australian Securities and Investments Commission with a scheme booklet expected in mid-June. 

But many shareholders are disappointed with the cash-and-scrip offer and say the deal, struck on February 23 with the support of the ConsMin board, does not account for nickel and manganese price rises. 

"I never thought it was a good deal from the outset," said one fund manager, who declined to be named. "I'm not sure about giving away 60 per cent of the company but I am very comfortable Gilbertson is involved." 

Neither Mr Gilbertson nor his Deutsche Bank advisers could be contacted for comment. ConsMin is being advised by JP Morgan. 

ConsMin chairman R Carter welcomed news of Investec's participation, saying it added clout to the Pallinghurst consortium and that ConsMin would be the beneficiary. 

"It diversifies and deepens the resources that Pallinghurst has been able to bring together, and we like the look of it," Mr Carter told The Australian. 

Mr Carter remains upbeat on the prospects of shareholders backing the deal, with a vote on the proposed scheme of arrangement expected to be held in July. 

ConsMin shares closed at a record high of $2.97, a substantial premium to the Pallinghurst-led offer valued at $2.28 a share.

--------------------------------------------------------------------------------


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## noirua (30 May 2007)

This takeover bid is different to most as CSM Directors favour the bid, subject to no counter-bid, and 40% of the new set-up stays with existing shareholders in CSM. Therefore, as the CSM shareprice rises so does the value of the bid, albeit only 40% of it. That we know.

Other factors are: The value to the new company of all the bidders expertise and heavyweight backing. The improved value of CSM with commodity price rises. There appear to be no other important matters.

The CSM shareprice is close to $3.00 and many may see speculation in that. A fair cash increase is in the region of 30c to 40c, IMHO.


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## Rimtalay (30 May 2007)

For a fair and reasonble offer to shareholders, it should be $2.10/share plus 2 shares for 5. This would value CSM at $3.50 /share.
Any less than that you would have to be a fool in accepting. Yes they can bring upside but you'll only get 40% of the upside.
Manganese prices are back up to 2005 levels and ConsMin will be making an extra $100million profit FY on manganese alone on these new prices. 
We are now talking US$5.00/dmtu CIF China which equates to US$4/dmtu FOB which equals sales revenue FY of $230 million at present costs of $108/ton This would leave a FY profit of $130 million.
Most shareholders wouldn't have a clue what is happening in the manganese and chrome ore markets and are just being lead like little lambs to the slaughter


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## ta2693 (30 May 2007)

"ConsMin shares closed at a record high of $2.97, a substantial premium to the Pallinghurst-led offer valued at $2.28 a share"
Does anyone know who is major shareholder of CSM?
What the chance of the take over be approved by shareholder given the bid price is substantially below the market price? If there is no chance, why these investo push the deal?  If the take over fail, it is no good for everybody involved.


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## Lert (30 May 2007)

ta2693 said:


> "ConsMin shares closed at a record high of $2.97, a substantial premium to the Pallinghurst-led offer valued at $2.28 a share"
> Does anyone know who is major shareholder of CSM?
> What the chance of the take over be approved by shareholder given the bid price is substantially below the market price? If there is no chance, why these investo push the deal?  If the take over fail, it is no good for everybody involved.




I'm not sure where the $2.97 'record high' number came from.. I think the record high should read something like $4.25 in september 2005..


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## ta2693 (30 May 2007)

Another question, where is the buyer from? If people know they will end in 2.28, why they pay 3 now to get 2.28 month later?  From the volume and price behavior, I do not think the buyer are crazy speculators.  So the result of CSM takeover would end in 1 bid price going to increase, 2 another bidder is collect the shares, maybe GS and JB were, maybe some Chinese or Indian.  I do not believe the shareholder will end in 2.28.


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## Rimtalay (30 May 2007)

Yes, $2.97 was a record for the last 12 months, it's $3.03 today, but CSM was $4.25+ in September 2005 when manganese was at record highs. 
Most people don't realise it is back at that price again, but Rod Baxter doesn't want to tell you. He's worried his deal will fall over. 
Baxter doesn't have any shares, it tell you a lot about a CEO who doesn't buy shares in his company.


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## Rimtalay (30 May 2007)

*Q3 manganese ore and alloy contracts set for sharp rises *
London 29 May 2007 13:23 
Third-quarter contract prices for manganese ore and alloys will increase by at least 25 percent from the second quarter on manganese ore shortages, producers indicated. Manganese ore producers are seeking a 50-80 cents gain in contract prices for the third quarter to around $3.60 per mtu on an fob basis, up from $2.80-3.10 in the second quarter. “ We see the quarterly and monthly contract prices rising steadily, with the spot price through the roof, ” said a large manganese ore producer. “ I have seen $4.80 cif and we will see these levels going into quarterly prices. – We will start negotiating next month, but people are hard up for ore, ” said a second producer. “ We will ask for a strong increase. ” He too said he expects a third-quarter price at around $3.60 per mtu. Ore spot prices have surged to $3.30-3.60 per mtu fob, their highest levels since the third quarter of 2005, from $3.10-3.30 previously, because of supply disruptions at major producers amid unabated strong demand (MB May 25). This has, in turn, led to manganese alloys prices surging, and third-quarter contracts are also set to see large increases. One silico-manganese producer mooted â‚¬1,000 ($1,345) per tonne for the third quarter to customers, while others are talking about a minimum of â‚¬900. This represents a 25-32 percent increase from â‚¬680-720 in the second quarter. Spot silico-manganese prices have risen to â‚¬800-850 per tonne from â‚¬700-730 previously on rising ore prices and pending anti-dumping investigations on imports of the product into Europe. Ferro-manganese could rise close to 30 percent in the third quarter to â‚¬850-900 per tonne, from â‚¬655-700 in the second quarter, producers said. “ Customers are getting worried about supply, ” said a large manganese alloys producer. “ I expect because of these concerns the negotiations will be quick. On the spot market we ’ ve seen prices tested well above where I thought it would be and customers weren ’ t even shocked. People are worried about getting their supply. ”  

    Manganese ore price lifts to highest level since Sep 05 
London 25 May 2007 15:41 
Manganese ore spot prices have jumped to levels last seen in September 2005 on supply disruptions at many major producers, while demand for ore has been holding unabated, market participants reported. Manganese alloys in Europe have been pushed up by the rising cost of ore, following similar trends in the USA and Asia. Manganese ore 48/50 percent manganese is now trading at $3.30-3.60 per mtu fob on the spot market, compared with $3.10-3.30 previously. Most tonnages from large suppliers are secured on long-term contracts, but the spot market has revived as demand for the ore surged this year, mainly driven by China. “ The cause of all the drama in the manganese market has been coming from the very high price for ore because of the huge demand increase in China, ” a large ore producer told MB. “ But more important is that this has combined with significant disruptions in deliveries to China from almost all the major suppliers. ” He referred to bottlenecks at ports from which Eramet has been shipping due to electricity problems, reduced ore output at CVRD ’ s Azul mine, which will be exacerbated by the closure of the mine from June for six months, and reduced output from Ghana after the Ukrainian group Privat bought the mine. “ BHP is having problems and not producing as much as they want, ” added a second large producer source. “ All of these are conspiring to put upward pressure on ore prices. The spot market is going through the roof. ” A third producer source said Chinese traders are driving prices up even further by holding onto material, with reports in the market of prices as high as $5-5.30 per mtu cif. “ When the ore price increase, the alloy prices follow, ” said the third producer source. Indeed, the price for ferro-manganese and silico-manganese in Europe jumped to â‚¬800-850 ($1,076-1,143) per tonne delivered on both products, from â‚¬670- 705 and â‚¬700-730 respectively. Silico-manganese spot business has been transacted at levels over â‚¬900 per tonne, market participants reported. One silico-manganese producer reported achieving â‚¬1,000 in Europe.  
“ Steel demand is very strong in Europe, ” said a manganese alloys producer. “ We have customers asking for prompt delivery, but we struggle because we are full. ” He said the European price on ferro-manganese with 7.5 percent carbon and silico-manganese basis 65-75 percent manganese has risen by at least â‚¬50 in the past week alone. “ Had we spoken a week ago, the price would certainly have been lower. The market has taken all the fundamentals at play on board and has now just been propelled forward by momentum, ” he said. All the producers said the jup in the spot price bodes well for the third-quarter contract negotiations, which are due to start “ pretty soon ”


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## Rimtalay (31 May 2007)

This Sean Gilbertson thinks its a done deal, he better up the price then. If they can only afford $320 million then better only give them 40%. That would mean $1.38/share plus 3 shares for 5. 
They're smart they realise ConsMin is undervalued by the market. "we like to identify assets that have been unloved, are not well supported, are not well understood "

*Sean Gilbertson: Partner, Pallinghurst Resources Fund*

28 May 2007 23:09 

MONEYWEB: Sean Gilbertson joins us now. Sean, the reason we wanted to chat to you was the announcement made from Pallinghurst and Investec and AMCI that you are going to be getting together and raising about $1bn to $1.5bn to invest in the resources sector. Why these partners in particular?

SEAN GILBERTSON: Well, Geoff, we've spent some time working with AMCI in the past and, as you may or may not know, I spent the early part of my career working in the coal business with a thing called Global Coal, and came across AMCI then. And we've always found AMCI to be a very pragmatic partner, so I think that's why probably they came to the table first. And Investec, of course, one of the famous home-grown South African names, again is an outfit that shares many of the strategic visions that we do. And accordingly, in part given their expertise in the resources sector, we thought they would make perfect partners together with AMCI - and that's resulted in today's announcement.

MONEYWEB: David was saying that we can draw from this partnership that assumingly you feel that there is some value still left in the resources sector. What sorts of companies are you going to be looking at?

SEAN GILBERTSON: Absolutely. And I like to think that, while I can tell you today about two of those opportunities, there is actually a pipeline of opportunities which we think are absolutely first rate. The first transaction, which we announced in February of this year, was a transaction with Consolidated Minerals of Australia, which is a producer of manganese ore, chromite nickel, tungsten and so forth - all of the things that you effectively need for steel companies. And under that transaction, which is fully supported by the Board of Consolidated Minerals, we would be acquiring 60% of that business for A$320m, which is approximately US$260m. And the idea is that we would use Consolidated Minerals as a growth vehicle to expand then, both by geography and also by commodity. So that's really opportunity number one. Opportunity number two is our long-held belief that there's a lot of merit in branding precious stones. And having looked at that opportunity over he last several years, we felt that by far and away the best brand name we could possibly get our hands on would be the FabergÃ© brand name of Russian and French heritage. And we spent some two years trying to do it, but in January of this year, I'm pleased to say that we were successful in acquiring the FabergÃ© brand name from Unilever, and will now set about creating a brand of gemstone strategy and acquiring access to appropriate underlying assets.

MONEYWEB: Looking at the Consolidated Minerals deal, you've taken 60% and Brian Gilbertson will be on the board, as well as the two founders of AMCI. Is this the way you are going to go about these deals - you're going to take board control, or not control necessarily, but play an active role in the companies you invest in?

SEAN GILBERTSON: Absolutely. Together with AMCI and Investec and our press release earlier today, we've also alluded to the involvement of the leading Asian steel player.

MONEYWEB: I take it you can't release the name?

SEAN GILBERTSON: Unfortunately Geoff, I can't tell you who that was. However, the documentation relating to the Consolidated Minerals transaction has just been filed in Australia, and will very soon be in the public domain. And what I can suggest to you is that if you get a copy of those documents when they're available, you will find the name of that steel company in the documents. To answer your question, yes, Consolidated Minerals is a good example of the type of transaction that we want to do. We are going to have, depending on the amount of money that we raise within Pallinghurst Resources itself, and together with the deal that we've announced today with Investec, and of course AMCI and the steel company, somewhere between a billion and $1.5bn. And with that money we would like to go after five to seven different platforms. Consolidated Minerals is one of those platforms, our precious stones player is another one of those platforms. We are not quite in a position to talk about the others yet, but I can tell you that the remaining opportunities are pretty well developed. So in general, yes, we do like to take controlling interests, 50% plus, with corresponding board representation - it doesn't necessarily have to be control. But the whole idea is that, rather than taking a shotgun approach whereby we just buy as many things as we possibly can and hope that an appropriate number of them work out, we would much prefer to pay very careful attention to each one of the businesses and ensure that they become world-class businesses.

MONEYWEB: Clearly, though, it's a lot of work for the board representees?

SEAN GILBERTSON: Yes, indeed it will be, and in fact, Arne Frandsen, whom I suspect you are probably familiar with, who has had a sterling track record in South Africa despite the fact that he's originally Danish, is a member of the Pallinghurst team, and I guess it's a token demonstration of our commitment to these assets that he will actually be inserted on a full-time basis with Consolidated Minerals, and that means that he's got to up-ship as it were and move to Perth, and he will take an executive position on the board as head of strategy and work very carefully and closely with that team for the foreseeable future in delivering the strategies that we've outlined for Consolidated Minerals.

MONEYWEB: Sean, you obviously are positive about the resources sector, but how do you see it placed at the moment - where do you see it going?

SEAN GILBERTSON: Well, if I could answer that question, Geoff, I probably wouldn't be sitting here talking to the day, or maybe I would be doing so from the back of a yacht parked somewhere in the Mediterranean. I think the difference is that the team of people that we've been privileged to put together in Pallinghurst Resources are not experts at calling the market - and what we do is not based on calling the market. What we believe we do doesn't depend on whether the market is going up, down or sideways, and that really means that we like to identify assets that have been unloved, are not well supported, are not well understood - and that we can strategically reposition those assets. And we believe that we can do that whether the markets are up, down or sideways.

MONEYWEB: Sean Gilbertson is a partner at Pallinghurst Resources. David, they sound like they've got a plan and they're looking to do quite a lot of things?

DAVID SHAPIRO: Sure. Well, he's got good DNA, old Sean. I think if you take Brian, his father's track record, he's been a superb miner and done very well. I'm very interested in the FabergÃ© branding, because De Beers started that with diamonds, or they've started to brand their diamonds so that you know the source of the stone. And also, what's interesting about De Beers, if ever you've gone to London to Bond Street there, they have a shop there - they have got actual retail outlets where they are branding the name. So I don't know whether we're going to get a FabergÃ© out where you can actually buy branded stones as well. But interesting strategy, and sounds confident. I think the only concern is it just shows you how much mining development is taking place outside of South Africa, and just how much we've got to catch up. And, having been a leader there, we are actually kind of playing catch-up now, or people are snapping at our heels in all respects.


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## Rimtalay (31 May 2007)

*(AMM) Squeeze takes silicomanganese to 90 cents a pound *
New York 30 May 2007 23:25 
Silicomanganese prices have spiked again, and consumers are bracing themselves for even higher prices driven by a tightening manganese ore market. Spot silicomanganese has jumped to between 84 and 90 cents per pound in the United States, up from a previous range of 72 to 80 cents per pound. One trader, who reported offering truckloads of the material for more than 90 cents per pound, said the shortage of supply has customers who are seeking large quantities at a disadvantage. "It actually works against you for larger quantities because the market is that tight," he said. "The problem is that a small-time consumer may be able to go to six or seven guys to get material, but a larger consumer might only find two or three guys who can quote on it." A pair of traders said consumers who were previously waiting for prices to fall before ordering are now hungry for material and have no choice but to pay top prices to meet their production needs. A manganese ore shortage in China continues to underpin the high prices for manganese metal and alloys. And the recent price rally for manganese alloys is showing no signs of slowing down, as customers anticipate a critical shortage once Cia. Val do Rio Doce closes its Azul Mine. The shutdown, to begin in June, is slated to last at least six months. Market sources said the company's lower manganese ore sales will further aggravate the current global shortage. In the first quarter of 2007, CVRD's ore sales fell 60 percent to 83,000 tonnes from its sales the previous quarter. Also tightening the supply picture in China is the restructuring of Ghana Manganese Ltd. on the back of its takeover by Ukraine's Privat Group in March. "The price of manganese metal is going up, we're seeing crazy prices and then there is the manganese ore shortage in China," a producer said. "Then once Azul closes that will add up to even more tightness in the manganese ore market."  
One producer said he expects to see the alloy trading for more than $1 a pound in the near term. Rumors that BHP Billiton is experiencing production problems, however, have been largely dismissed by U.S. traders as unfounded. U.S. silicomanganese production continues to struggle to fill the void, as the country's largest producer, Eramet Marietta Inc., cannot make enough to take advantage of the rocketing spot market, sources said. Copyright  © Metal Bulletin PLC. All rights reserved.


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## noirua (31 May 2007)

How much truth is there in the thinking that AMCI are looking to add their Aussie coal interests to the Consolidated Minerals set-up and form a larger diversified Mining House?


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## Rimtalay (31 May 2007)

Don't be so silly to even think for one minute that they will give you anything more than $1.38/share plus 2 share for 5. If they buy anything else they will just do a capital raising for themselves at a price they decide. If they SELL any existing assets into the company they will sell at their own price and take out as many shares as they want. Don't forget they'll have 60% of the shares. You'll get nothing for free.
They are already trying to rip you off by not announcing to the market about the latest manganese prices. I have made a formal complaint to the ASX, and I wouldn't do that unless I was 100% sure of their game.
READ THIS - DID BAXTER TELL YOU ABOUT IT - NO WAY- 

*Mn ore price to push up next quarter *
2007-5-31 10:52:41 BEIJING (Asian Metal) 31 May 07 –
 Manganese ore tightness is getting worse and some participants are already airing producers are bend on increasing price by almost 50%, however, all attempt to confirm from producers failed. According to manganese alloy producer in India, manganese ore producers in Australia have decided to increase price for next quarter by almost 50% due to shortage of material and increasing demand. Normally the company buy 7,000tpm but they are informed that cannot get up to that quantity, price now for July -August consignment is USD6-6.5/dmtu CIF Calcutta for lumpy 48% Mn. The domestic producers like Tata are not offering material for sales and other are selling limited quantity. A trader source in Singapore informed that in Shanghai ferroalloy summit, it was unanimously agreed by producers and consumers to hike standard grade manganese ore next quarter to USD6.5/dmtu CIF Chinese main port for 48% Mn, presently, price is stable and supply is still tight. Although manganese ore market is still tight, for prices to double next quarter would definitely worsen already volatile manganese alloy market.


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## RM8 (1 June 2007)

Rimtalay - surely most shareholders especially the larger ones are aware of whats happening in the markets with maganese etc.

They will be expecting an adjustment to the offer terms before they accept. Doesn't the current share price reflect this?


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## Sainter (1 June 2007)

*The real cost of this deal to shareholders*

To put the 'offer' in perspective, basically Gilbertson wants to buy 3 of every 5 shares you own for $2.28. He will let you keep the other two which of course are worth the current market value. Remember, the company does not change one iota as a result of the deal getting up-just the personnel on the board (it becomes bigger and therefore more costly to maintain). 
The 'promise' is a bigger company at some stage in the future, which hopefully means a loftier shareprice. Well, given you would have sold 3 of every 5 shares you own for $2.28, the remaining two of five shares need to appreciate in value, just to make up for the money you will lose if the deal gets up. That is, at a closing price today of $2.93, the new 'par' price would be $3.91-just to get the money back Gilbertson will take from you.  It's not as if he's so poor he needs your charity, is it? VOTE NO!

current price	'par' price post deal (if it gets up)
2.28			2.28
2.30			2.33
2.40			2.58
2.50			2.83
2.60			3.08
2.70			3.33
2.80			3.58
2.90			3.83
3.00			4.08
3.10			4.33
2.93                    3.91


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## Rimtalay (2 June 2007)

Hi Sainter, yes you are 100% correct, I'd never thought about it like that before. I should have, because I am now used to Baxter's gobbledygook, mumbo jumbo and drivel about the manganese and chrome ore prices.
Why would anyone be so stupid as to sell their 3 shares to Gilbertson for $2.28/share.
The way manganese and chrome ore markets are going ConsMin will make a fortune FY08.
WE do however need NEW management.
Let's hope Baxter will fall on his sword when we vote NO.


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## Rimtalay (3 June 2007)

Check out the CSM VOTE NO website.
latest manganese prices, chart and graph

http://www.usail2.com/manganese_chart_graph.htm
Please note that the increase from Jan 07 (US$2.75/dmtu) till today 1st June 07 (US$4.25/dmtu) is US$1.55/dmtu . This increase assuming similar costs will increase the profit by AUD$85 million FY08 for similar production as FY07.


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## hubisan (3 June 2007)

*Need to connect shareholders together and vote NO to any deal for now*

I would like to insist that if the Pallinghurst deal happens you will get some cash (whatever the improved cash offer might be) and you will keep 40% of your shares. Then what will be the price of these shares afterwards? I TELL YOU that these shares will be worth less than what they are worth NOW. How much less? Very much less! Because these shares will be minority shares in a company managed by Pallinghurst. My valuation is that the share may LOOSE 50% of previous value. A minority share in general is at least -20% wrt a control share like the one you have now. But with a greedy investor like Pallinghurst (Do i have to prove that?) with well known  connections to mining interest from third parties, (russian, AMCI, south african whatelse?)  once they have control there is nothing that will prevent them from selling CONSMIN assets to friendly interests at discount price first. If you want a sign: AMCI has sold its Australian mining interests=> There is no prospect for any of these raiders to bring assets to CONSMIN but on the contrary it is likely that they will sell assets. Do you want to take the risk to mandate Pallinghurst to sell Consmin assets and give you charity? If you want to be a LOOSER you can say YES to any Pallinghurst deal where you become minority holder. My first message is: DO NOT VALUE the share they give  you at the same price as the share they have taken from you. These two shares are totally different. If you do the computations with my guidance you will get a better idea of how much you loose. My second message is :  IT IS NOT THE MOMENT TO SELL ANY CONSMIN share EVEN FOR 100% CASH. CONSMIN is in full recovery and has tremendous prospects of immediate PROFITABILITY (Our manganese M;INE is a CASHCOW) and future very profitable GROWTH (in nickel). CONSMIN has a future with more than 1 and maybe several Billion AU dollars. It is not possible to value all this upside in a CASH offer.  I vote NO to ANY DEAL. The only thing I vote is to replace the management because they tried to fool us . REMEMBER a MINORITY share is WORTH LITTLE, your present share of UNCONTROLLED diversified mine  is UNVALUABLE, means cannot be VALUED at PRESENT time. And the most useful thing to do is to connect shareholders together and prepare resolutions for the meeting.
By HUBISAN.
I can be contacted at:  hubisan1asp@free.fr


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## hubisan (3 June 2007)

*Some questions to large CONSMIN  institutional holders*

1/ Who can  pretend that he has reasons to trust, or that he can control, the future course of action of Pallinghurst and Mr Gilbertson to be in the interest of present CONSMIN shareholders?
SO why accept to become a minority holder of new Consmin controlled by Pallinghurst? 

2/ Who is able to value the potential of Consmin NOW?
The nickel production could be twice or triple the current one within a few semesters. The prices of nickel managanese and chrome are exploding. Many signs show that this may last. The cumulative effect of all that is so important on the valuation of Consmin that no bidder can value all this upside. So why sell now?

3/ What better investment for your money do you have if you sell COnsmin? 
We are between Chinese demand and Australian ore? What better place to be? Think high prices won't last? 
The response from CVRD on manganese is clear. They are not impressed by volatility of demand and price ; they shutdown production in order to reorganise and reduce costs.  They are not afraid of loosing "a time window of high prices": a clear sign that the power is to the producers and high prices of manganese are here to stay.  We do not need Palinghurst to get more pricing power on manganese price CVRD does the work for us.
The case for future profitability of  nickel and chromium at Consmin is also clear to me. 
Consmin doesnot need cash. The managenese mine is now a very big CASHFLOW and even excellent profit. And the life index of this mine is increasing going forward with exploitation!
We do not need projects nor assets for growth. Nickel assets have plenty of upside. Consmin has everything except a management working in the interest of shareholders. 


4/ Why not consider to  replace this management who tries to fool you institutional shareholders and us ?

5/ Why not fight the offer on the public place to get a better offer at least?
A simple public statement from a major institutional holder could turn all this mess down and would also trigger further recovery of the share.
The share is down because the market fears that a proposal as weak as the Pallinghurst one may have some chances to be successful with  some hike in the cash fraction of the price.

Final comment :
Large institutional shareholders are responsible for their vote and they must vote on behalf of the people who give them money. If they agree to the deal they will be accountable for that.  My perception is that if they accept the deal it can be questionned whether they themseves act in the best interest of the people who give them money to invest.
Minority holders of Consmin may ask that also.

Hubisan


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## Rimtalay (5 June 2007)

*    (AMM) No escape from manganese beast: traders *
New York 04 June 2007 21:15 
U.S. silicomanganese prices spiked again Monday as spot sales ploughed through 90 cents per pound on a scarcity of domestic supply and critical lack of imports from China. Spot silicomanganese is now trading between 90 and 96 cents per pound in the United States, up from a previous range of 84 to 90 cents per pound. One trader, who reported selling a small tonnage at around $1.05 a pound, said that truckload sales of alloy are now being offered at a minimum of 95 cents per pound. A manganese ore shortage in China has sent the price of all manganese alloys and metal soaring, limiting exports to the United States and leaving customers scrambling to get their hands on material. "There is just nothing available," a second trader said. "In China, the demand side is strong internally and on the ore side there is a shortage, so prices are high and (U.S.) traders are sitting on the sidelines because they don't have the capital to bring in any material." The country's largest producer of the alloy, Eramet Marietta Inc., is unable to offer any material on the spot market. The company's facility in Marietta, Ohio, is reportedly running at capacity following an unplanned six-week outage that began in early March. However, it has not withdrawn a force majeure declaration from that period, and sources said it is stockpiling any excess material it makes so that it can continue to satisfy contracts when one of its furnaces is taken down for a major rebuild later this year. The company isn't expected to offer material on the spot market until 2008, a source close to Eramet Marietta said. Historically, high silicomanganese prices have compelled users to switch out of the alloy and substitute it with a combination of ferrosilicon and high-carbon ferromanganese. But the market hasn't witnessed a wave of substitution because the manganese ore shortage in China has also underpinned nearly record highs for ferromanganese, while ferrosilicon is also pricey by historic standards.  
U.S. high-carbon ferromanganese is now trading hands between $1,300 and $1,600 per long ton, just $200 shy of its $1,800-per-ton record set in April 2004. And market players said it is just a matter of time before all manganese alloys breach U.S. records. "There is nothing on the horizon that is going to save the consumer," the second trader said. "In 2004 a handful of producers came onboard to increase production, but this time we're not going to see any increase in domestic production." "You can only substitute with what is available and right now everything is very tight," a producer said. "China has a monopoly on ferrosilicon so you're going to run into the same problems with getting that material into the country." Spot ferrosilicon has climbed rapidly in the past week to trade between 62 cents and 72 cents per pound, up from a previous range of 59 cents to 61 cents per pound. "China's offering at numbers in the high 60s, so you have to be over that in order to be profitable here," the first trader said. A tender issued by Gerdau Ameristeel Corp. for a large quantity of high-carbon ferromanganese and silicomanganese is due Tuesday, a pair of traders said. "Gerdau's out this week and what they get will influence high-carbon ferromanganese, silicomanganese and ferrosilicon prices," the second trader said.


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## kerosam (6 June 2007)

hi CSM-faithfuls,

quite a drop from the high $2.90s today. a normal retrace or pple pulling out?

i hold.


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## Rimtalay (7 June 2007)

Read the AFR tomorrow.
You'll be glad that you hold CSM, the good news can be covered up for only so long


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## questionall_42 (7 June 2007)

Rimtalay said:


> Read the AFR tomorrow.
> You'll be glad that you hold CSM, the good news can be covered up for only so long




That's an intiguing statement Rimtalay.  I have really appreciated yr posts in this thread; so, would care to enlighten us on tomorrow's news in the AFR?


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## Rimtalay (7 June 2007)

Read it tomorrow in the AFR, it only costs $2.50, then you'll know the whole story. I guess it will tell you that manganese has gone up 100% and that ConsMin management are trying to hide the news.

But since I didn't write the story, then I'll have to wait like you.


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## Rimtalay (7 June 2007)

DID YOU KNOW  MANGANESE IS UP & CSM IS MAKING A FORTUNE?    NO!      YOU DIDN'T HAVE A CLUE.      WHY?     CONSMIN management don't want to tell you and they are trying to cover up the facts because they want this deal with Gilbertson.      WHY?       Rod Baxter gets to keep his job and will be elevated to MD of the New ConsMin.
This information is from Ryan's Notes  Metal Trading Report
Manganese - RN 48% manganese ore $/MnU 4.9 5.2 6/5/2007
Manganese - RN 48% manganese ore $/MnU 4.9 5.2 6/1/2007
Manganese - RN 48% manganese ore $/MnU 4.7 5 5/25/2007
Manganese - RN 48% manganese ore $/MnU 4.7 5 5/22/2007
Manganese - RN 48% manganese ore $/MnU 4.35 4.6 5/18/2007
Manganese - RN 48% manganese ore $/MnU 4.2 4.3 5/15/2007
Manganese - RN 48% manganese ore $/MnU 4.2 4.3 5/11/2007
Manganese - RN 48% manganese ore $/MnU 3.8 4 5/8/2007
Manganese - RN 48% manganese ore $/MnU 3.6 4 5/4/2007
Manganese - RN 48% manganese ore $/MnU 3.2 3.6 5/1/2007
Note a 54% rise low side and 45% rise high side in just over the month
REMEMBER US$1.00/dmtu increase = AUD$54 million extra pretax profit FY for ConsMin, and we have just seen a US$1.70/dmtu  increase in just one month and it's about to blow through the roof.
www.asianmetal.com is talking about US$8/dmtu in the near future.


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## RM8 (7 June 2007)

Rimtalay said:


> Read it tomorrow in the AFR, it only costs $2.50, then you'll know the whole story. I guess it will tell you that manganese has gone up 100% and that ConsMin management are trying to hide the news.
> 
> But since I didn't write the story, then I'll have to wait like you.




$2.70 actually, but thanks for the heads up Rimtaley, I'll look out for it.

Sounds like Baxter needs to go for a row


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## Rimtalay (7 June 2007)

www.metal-pages.com 7th July 07
"Manganese alloys continued to move down slowly as the demand was not as strong as it wascouple of months. Domestic steel mills that are facing increased export duty on steel products
on expensive raw materials hence the market came into a deadlock. But the general consensus market would move down slowly further in the following weeks and a plummet is being values for manganese ore, which is being quoted in a range between *RMB62-65/mtu *in the spothigh grade (Mn 48%) lumpy material."

"Manganese ore (Aus 48% Min) Rmb62-65/mtu Rmb62-65/mtu "

NOTE: Rmb 62-65/dmtu  is = US$8.10 -US$8.49/dmtu.
NOTE: over US$2.00/dmtu every US$1.00/dmtu = AUD$54 million pretax profit for ConsMin


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## Rimtalay (8 June 2007)

Sorry it is $2.70 to retail customers. It's only $2.50 wholesale.
Still its worth spending your $2.70 then.

The important thing is the story is in the AFR
'ConsMin sweats on Ore prices'
Key Points
* An offer for Consolidated Minerals now looks low
*The board faces criticism for endorsing the bid

The action will really start when the scheme documentation hits the deck.
The game will then begin in earnest.


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## Rimtalay (8 June 2007)

Hi all, this will save you the $2.70 for the AFR


*ConsMin sweats on ore prices*
Michael Vaughan
Release of documentation supporting Brian Gilbertson’s play for control of Consolidated Minerals is days away and it looks like the manganese price might have mciii- hers of the board sweating.
Not for the reasons one might expect: the rising price of the steel- making metal is in danger of giving more ammunition to those who argue the board-endorsed Gilbertson bid is too low.
Last year, a weak price for manganese was the main factor in a $50 million drop in ConsMln’s full- year earnings, causing the company to record its first loss since 1999.
In stark contrast, the manganese price has surged in the past two months in a run brokers at Macquarie Research described as “remarkable” this week.
ConsMin is trying to complete a transaction with Pallinghurst Resources, of which Mr Gilbertson, the one-time chief executive of BlIP flilliton, is chairman.
The deal would give Pallinghurst 60 per cent of the company.
Pallinghurst has offered ConsMin shareholders $1.38 and two shares in the new company for every five shares they hold.
The offer originally had a nominal value of $128 but a rise in the ConsMin share price means it was worth $2.50 yesterday.
The transformation Mr Gilbert- son has promised to bring to the company has widespread support but some analysts and shareholders believe his price is too low.
He plans to increase ConsMin’s manganese production to take its share of the wotid’s high-grade supply to more than its 10 per cent
Unlike nickel or zinc, manganese is not traded on an exchange.
• An offer for Consolidated Minerals now looks low.
• The board faces criticism for endorsing the bid.
Buyers and sellers of the metal settle through over-the-counter contracts or on a small spot market.
After the 2006 loss, ConsMin decided to stop issuing profit forecasts and instead give price expectations and production forecasts.
“The company believes that through providing forecasts of production and costs, along with the regular reporting of commodity prices attained by the business, analysts and investors will be better positioned to have an informed view of the profit outlook,” ConsMin said last August
The company’s most recent guidance -For manganese prices finishes at the end of the month. ConsMin expects to receive an average price of about $US2.50 per dry metric ton unit, or DMTUt
The full-year average price is forecast at $US2.30 a DMTU.
Reports of prices into China of between $US5 and $US&50 have surfaced recently, although that price includes cost, insurance and freight charges.
ConsMin does not include such costs in its contracts meaning it receives a lower headline price.
About 50 per cent of ConsMin’s sales go to China and it negotiates prices on a quarterly contract It expects to produce 900,000 tomes to 925,000 tonnes in fiscal 2007.
“Discussions for the next quarter’s pricing will be concluded later this month, at which time we will update the market on pricing should that be required,” ConsMin’s general manager for marketing, Peter Allen, said.
Meanwhile, ConsMin’s under- performing nickel business should also have received a boost, as the company is expected to rmalise all its hedging arrangements.
At the start of the June quarter, the company had just 180 tonnes hedged at $13.52 a pound.
More than 1000 tonnes of nickel should be produced this quarter and prices are now $24.55 a pound.
The Atathan Finandal Review also understands the company has made some promising drillinghits at Widgiemooltha.
ConsMin’s share price closed up 3$ at $2.80 yesterday.


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## noirua (8 June 2007)

Many Aussie Miners are being hit by the strength of the Aussie Dollar against the greenback. It is still my view that an upping of the current offer by 30 to 40 cents should win the day for the threesome.


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## Rimtalay (8 June 2007)

Hi noirua, do you have any clue as to how much CSM will make in FY08, with current nickel, chrome and manganese prices. 
Gilbertson doesn't have a chance not at 30 or 40 cents, more a buck maybe, I spoken with major holders, like several in the top 10 and many in the top 100 and they will note NO for any offer under $3.50. 
They are more interested in Baxter's and Carter's heads at the moment.
Wait till the scheme documentation comes out, these big holders will make it public then. Just wait and see. These people are not fools.
Do a few calculations for yourself.
You sell 3 or everyone of your 5 shares to Gilbertson for $2.30. In otherwords you lose 50c/share on those three shares. ie $1.50. If the new Consmin opens up at $2.80 , you'll lose but Gilbertson will make $68 million, because suckers sold out. If the share price opens up at $3.55 which will be your breakeven price on your shares that were $2.80.
If they reopen at $3.55, you'll breakeven but Gilbertson will make $172 million.
You might think that its good business, but people who have millions in this think it stinks. I'm in the top 50, and I also think it stinks.


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## kerosam (8 June 2007)

hi guys, read the story free from the Merchant cafe (free AFR)  might be able to buy one more CMS share on Monday with that savings.

depending on what happened to WGR, i might buy more CSM come Monday. 

thanks.

Hey, Rimtalay. Keep up the good work with the updates.


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## Rimtalay (8 June 2007)

The scheme documents have just been released, on the ASX.
400+ pages, read it carefully, I bet they have left lots out.
Vote No


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## Aedo (9 June 2007)

Rimtalay said:


> The scheme documents have just been released, on the ASX.
> 400+ pages, read it carefully, I bet they have left lots out.
> Vote No




It can also be downloaded from the consmin website where it is a 7MB pdf file rather than the 18MB scanned fax on the ASX site.


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## noirua (9 June 2007)

Rimtalay said:


> Hi noirua, do you have any clue as to how much CSM will make in FY08, with current nickel, chrome and manganese prices.
> Gilbertson doesn't have a chance not at 30 or 40 cents, more a buck maybe, I spoken with major holders, like several in the top 10 and many in the top 100 and they will note NO for any offer under $3.50.
> They are more interested in Baxter's and Carter's heads at the moment.
> Wait till the scheme documentation comes out, these big holders will make it public then. Just wait and see. These people are not fools.
> ...





Hi rimtalay et al, All the figures sound absolutely wonderful, however, the market values CSM at $2.73 at the close on Friday. This makes the offer worth $2.47 a difference of just 26 cents. An increase of 30 cents to 40 cents would up the offer to a maximum of $2.88. 

Valuations do sound wonderful on paper, but costs for development and taxation do put a dampener on some of your figures. You also seem to ignore the risk factors on some projects, from an analytical point of view. 

The cash position of CSM is not all that wonderful.


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## Sainter (9 June 2007)

Noirua (you backwards star you!),
Can you please expand on what you mean by development costs when the main increase in revenue is coming from an increase in the price received for manganese?
Cheers!


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## Rimtalay (10 June 2007)

Hi Noirua
This is a rip-off,  and the entire ConsMin management should be sacked.
They are hiding  information and good news, the latest Ryan's Notes says that they are doing manganese deals for next quarter at $7.40/dmtu. Not at US$3.30/dmtu as it says in their scheme documents.
ConsMin shareholders need to start being vocal, don't always leave it to someone else. We have to fight this takeover now. The price of manganese is such that ConsMin will make $200 million next year, don't be a sucker and give Gilbertson $millons of shareholders money.
Send the management a clear message NOW.
Tell the management you'll vote NO
email baxter rbaxter@consminerals.com.au
Ask him why he doesn't tell the truth, why is he lying to shareholders?
 When you get out your scheme documents get out your calculator, these halfwits can't even multiply. I have already found 3 calculation mistakes on one page, either a typo or stupidity. ConsMin and PWC should not present such information with so many mistakes. They  can't even add up.
I won't tell you here on the forum as I believe Mr David Brook ( Investor Relations ) is monitoring the forum, and I don't want them to know of their mistakes until it is made public in newspapers.
We have caused more pain to them than you would believe and all hell is about to break loose, so sit back and enjoy. The big boys are about to blow their cool.


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## Rimtalay (10 June 2007)

Hi Noirua,
I offer an open invitation to you, send an email to info@catamaransaustralia.com and I will send you the documents on chrome ore and manganese ore prices and proof that Consolidated Minerals has done deals at US$7.40/dmtu.
This means US$7.40 x 48% X 920,000= AUD$400 million. Yes it is CIF, so you need to deduct freight, insurance, port costs to get FOB
Chrome ore market is up 100%, RSA 39% Cr2O3 $270-280/ton FOB.
If the idiots at Consmin are not getting the market price then they should all be sacked. They should all be sacked anyway, including Baxter's sidekick David Brook.
 Are you happy that Gilbertson will get 60% of the final dividend, and make $170 million before shareholders break-even on the deal.
If I prove it to you, then don't be a fence sitter or hide . Speak up for your rights, and demand  a fair and reasonable deal for shareholders. Otherwise :hide:


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## ta2693 (10 June 2007)

In the independent expert report, it said "PricewaterhouseCoopers has determined that the Share Scheme is not fair, but is reasonable."
I do not understand why I have to accept an offer which is not fair? 
How come accepting the offer is in the best interest of me?


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## ta2693 (10 June 2007)

Rank by size of Holding   Name of Holder  Shares held(millions)    % of Shares
1                              Noble Group                    14.0                6.2
2                         AMP Capital Investors              7.0                3.1
3      Orbis Investment Management Limited           6.9                 3.0
4                   Colonial First State                       6.5                  2.9
5               APS Asset Management                     6.0                  2.6

I am very interested in what they think about accepting an unfair offer.


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## Rimtalay (11 June 2007)

I can tell you one of those top 5 have already told me that they will not accept the offer. I'm hoping they will talk to the others.
The entire board needs to be sacked.
The scheme documents show a FY08 budgeted manganese production 100,000 tons less than this year. They should be targeting 1- 1.1 million tons of manganese when the price is at US$7.40/dmtu.
The big boys should call an EGM and sack the board, and take it over. I suggest a 1 for 2 share capital raising at $2.50/share, we'd all keep our company, raise $280 million, pay down some dept, build a nickel concentrator and ramp up the nickel, not like the idiots we have there now. I bet the share price would be at $4 within weeks. 
There is nothing fair and there is nothing reasonable about the deal.
The scheme documents are designed to down play the value of the company. Don't just casually glance at the document, get out your calculator and go through it word by word.
Baxter is a director of Titan Resources, that's what it says. The company was wound up nearly a year ago. They are too stupid to even proof read the document. If these are the people running this show, I shake my head. I've been in business 30 years and I can't believe that this is how they look after shareholder interests.


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## Col Lector (11 June 2007)

The article below raises questions as to whether major shareholder Noble Group will support Pallinghurst's obviously inadequate play for OUR-CSM.....
Maybe a call to Elman Rimtalay? Keep up the good work.

SMH Home  » Business  » Xchange  » Article 
 March 27, 2007
Rival bid possible

It's possible the former BHP Billiton chief executive, Brian Gilbertson, and AMCI aren't the only ones eyeing Perth miner Consolidated Minerals.

Richard Elman, the chief executive of Hong Kong commodities trader Noble Group, tendered his resignation from the ConsMin board last week, sparking speculation Noble might be considering a rival bid for the miner.

ConsMin attributed Elman's resignation to "increasing demands" associated with his position at Noble. But John Meyer, an analyst with Numis Securities - which until recently was ConsMin's London adviser-broker - said there could be a different explanation.

"Noble Metals might look to make a rival offer for Consolidated Minerals and this could be the reason for Elman's resignation," he told clients.

A former ConsMin managing director, Michael Kiernan, is close to Noble through his new ventures such as Territory Iron, but he told Xchange he was not involved with any potential rival tilt at ConsMin. Kiernan had left amid anger from Australian institutions over his pay packet.

"The shareholders are the ones who shot me," he said. "I've had no Australian institution who has said, 'I'd like you back'."

ConsMin shares closed 4c higher at $2.36. The Gilbertson-led partial private equity bid values it at $2.28 a share.

Edited by Matt O'Sullivan

xchange@smh.com.au


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## redandgreen (11 June 2007)

Rim..... thought you might be interested in this point of view    
   CSM; The "rich uncle" arrives 

Consolidated Minerals (CSM) has been one of the most frustrating stocks of the resource cycle to date. The company has been held hostage to the volatility of manganese markets, with earnings proving exponentially volatile. For the 2 years before speculation increased about a potential "white knight" arriving for the company, CSM underperformed the benchmark ASX200 by -75%, and underperformed the ASX200 Resources Index by -94%. Quite frankly, in market cap adjusted terms it was just about the worst performer in the ASX200 Resources Index. 

Then along came Brian Gilbertson and his Pallinghurst consortium. Since the Pallinghurst consortium confirmed the structure of its offer for CSM (on Feb 22nd), the stock has beaten the ASX200 by +19% and the ASX200 Resources index by +12%. 

Sometimes in investing you have some good luck. However, what are the chances that your grossly underperforming mid-cap resource stock receives a takeover offer from the former CEO of BHP Billiton, yet the proposal also allows you to participate in the upside of the new vehicle? The odds must be 10,000:1, and CSM shareholders must make no mistake that this is the biggest "get out of jail free card" they could possible have been handed. 

Let alone being a "get out of jail free card" for long-suffering CSM shareholders, this "co-invest" proposal from Pallinghurst is in my opinion likely to be highly value creating for those who accept the offer, or invest in the "new CSM" when its listed. 

It is honestly like CSM shareholders have found a rich uncle they never knew they had. 

I spent an hour with "rich uncle" Gilbertson and his consortium members last week, and I am going to explain why I believe accepting an offer that currently values the company at -20% below today's share price is the right medium-term plan. I am also going to explain why I believe buying CSM shares on market and accepting an offer that values the company at -20% below the current share price is the right medium-term idea. Rest assured I haven't lost my mind; sometimes in life you have to think completely outside the square to make real money. 

The new CSM

I have to admit I never thought I'd ever be sitting down with global resource sector heavyweights Brian Gilbertson and AMCI founder Hans Mende discussing CSM. You might have thought the topic would be AWC or RIO (maybe it will be one day), but here we are talking about the merits of their offer and vision for CSM. 

The Pallinghurst Investor consortium is no lightweight partnership. It includes Pallinghurst Resources, AMCI, and Investec, while Korea's POSCO has a 16.6% call option over equity. In their own words, Pallinghurst are proposing "a company-transforming partnership with Consolidated Minerals". "The deal aims to create a new, mid-tier resources champion, with access to high-quality opportunities, capital, and world-class experience and expertise". 

The vision

Pallinghurst's stated vision is to create a US$5-10bn mid-tier Australian mining company in the next 3-5 years. That's a big goal considering CSM's current market cap is A$600m. They aim to produce returns well above the industry average, which should justify a premium rating. 

They aim to participate actively in the rationalisation of the ferroalloys industry. The model is based on a combination of the highly successful Billiton (organic growth + M&A), and Xstrata (key shareholder support from Glencore) models. They aim to fill the void created by the acquisitions of MIM and WMC. Quite frankly, if it was anyone else stating these goals they would be dismissed as "too ambitious", yet the track record of those involved suggest these goals are highly achievable in the timeframe suggested. 

The point CSM shareholders need to understand very clearly is that Pallinghurst's plan, and ability to deliver on that plan, for CSM are greatly different from any standalone option for CSM, or any option with another Australian listed resource company. Interestingly, the CSM Board has recommended the offer. 

The right co-invest model

We have been very critical in these notes about general private equity tactics in Australia. Most P.E players have brought the proverbial "cash to a script fight", with no consideration for rollover relief or co-investing options for existing target shareholders. 

The Pallinghurst offer for CSM is the first in Australia where these issues have been taken into consideration, and that is one of the key reasons why it should succeed when the scheme vote comes up in the next few months. 

Pallinghurst have offered CSM shareholders A$1.38 cash plus 2 shares in "new CSM" for every 5 CSM currently held. At the current CSM share price, that offer values CSM at $2.58. It's worth remembering, this was a stock that was wallowing around $1.75 before news of an approach leaked into the market. In true terms, the offer values CSM at a 47% premium to the pre-bid leak price. 

I find it very surprising that I read in the press that people describe the Pallinghurst offer for CSM as "clearly inadequate". Inadequate versus what? The prevailing CSM share price seems to be the benchmark for those "inadequate offer" comments, but the current CSM share price is a clearly been driven by "the Gilbertson factor". In effect, and in my understanding of how markets work, the Pallinghurst consortium has sold their vision for CSM so well that they have attracted new investors onto the CSM register who are simply prepared to pay a premium to get assured exposure to the "new CSM". 

"New CSM" will be 60% Pallinghurst and 40% existing CSM shareholders who have rolled into the new vehicle on the 2:5 ratio. What you pay on market above the implied offer price is decided by what value you ascribe to the "Gilbertson et al" factor. Currently, as implied by the CSM share price premium to the bid, that value is +20% above the offer. In my own mind that implied premium for the "Gilbertson et al" factor will prove cheap in the medium-term, and that's why I believe hedge funds are paying that premium to the implied price. They are buying to accept the current proposal. They are not buying in hope of a higher or competing offer. I can't see any other offer that could possible add more value in the medium-term to existing CSM shareholders, or why anyone would pay a 68% premium to the pre-offer CSM price without the intention of accepting the Pallinghurst proposal. 

It is not a common event that we recommend accepting an offer -20% below the prevailing share price. However, as we attempt to explain above, Pallinghurst have created so much interest in their proposal from new investors that CSM has moved to a significant premium to their own offer. The temptation for CSM shareholders would clearly be to sell on market and accept the 68% premium to the pre-offer share price. However, selling on market are creating a full capital gains tax event, while giving up leverage to "Gilbertson et al." seems a very bad plan to my way of thinking. By the time you've paid CGT you basically receive after tax cash below the Pallinghurst implied offer price, and give up any upside to their clear medium-term growth aspirations. 

Do not underestimate "new CSM's" growth aspirations

Section 3 of the Pallinghurst proposal is the most interesting part of the document. It is titled "What Pallinghurst brings to CSM", and this is what the hedge funds are buying. 

Firstly, they bring deep pockets to CSM. CSM was short of growth capital, and Pallinghurst brings A$320 of equity commitment/cornerstone investment, and a further US$250m potential equity funding to accelerate project development. New CSM will have no shortage of potential growth project opportunities, with Pallinghurst signing a relationship deed which gives CSM first shot at projects offered to Pallinghurst. 

"The rich uncle effect" 

If you look at global resource house models that have delivered outperformance to minority shareholders over the last 5 years, many of the best performers do have "the rich uncle" shareholding structure.


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## Rimtalay (11 June 2007)

Well if the 'rich uncle' wants to rip-off shareholders now, heaven knows what Gilbertson will do when he owns 60%

*Cost to shareholders - $170.7 million to break-even*
Has anyone calculated the deal and it's cost to shareholders. 
For every 5 shares you own, you're giving Gilbertson 3 at $2.30 each, (5 x $1.38= $6.90/3 = $2.30) you still keep your other two shares ( now New ConsMin) valued at $2.80 in todays money. You've lost 50c /share on those three shares. 
If the NewConsMin opens at $2.80, you have effectively lost $1.50 over the deal (5 shares) 
Gilbertson however will make $68.28 million. (227,621,130 shares x 60% x 0.50c/share) 
If the share reopens at $3.55 , you will just break-even ( your 2 remaining shares at $2.80 + the loss of $1.50 on the 3 shares you sold to Gilbertson, so add 0.75c onto each share to get to your break-even position, so $2.80 + 0.75 = $3.55. 
When you manage to break even at $3.55, Gilbertson will have made $170.5 million profit on the transaction. ( 227,621,130 shares x 60% x $1.25 = $170.7 million)
Plus everyone forgets about the final dividend ( should be 8c) remember we have owned the shares for the whole year, but Gilbertson will get your 60% share of the dividend = $10.9 million of OUR  money. 

As far as I'm concerned Gilbertson can pay a FAIR and REASONABLE price, otherwise go somewhere else and steal someone elses shares.


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## Rimtalay (12 June 2007)

*The Vote No campaign is now in top gear.*
Two of the top 5 holders have now confirmed they will vote NO.
*NOTE*
AMCI is based in the Cayman Islands as is Pallinghurst Founder LP.  Pallinghurst Investor is in the process of becoming incorporated in the Netherlands ie. Netherlands Antilles. This may have significant tax consequences for Australia . The arrangements in the
Cayman Is and Netherlands Antilles is to stop you finding out what they are
doing and what tax is being paid.

As far as I am aware there are no mines in either the Netherlands Antilles or the Cayman Islands.
So not only do they plan to rip off shareholders, they also plan to rip off the Australian Government for taxes.
And Baxter and Carter want you  to vote for these people and take our 60% of ConsMin. You have to be joking !!!!!


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## hubisan (13 June 2007)

*To redandgreen*

Don't know where you found that bull**** about the analysis of the market premium as a proxy to Gilbertson future added value but no rational investor can accept this paradoxal argument

It is very simple.
Management and raider Pallinghurst lead by Gilbertson do everything to undervalue Consmin because it is in their interest.

Therefore I do not trust them and I don't think that they will grow the company.On the contrary I believe that they will steal assets from Consmin.

Therefore I consider that Pallinghurst offer is 1.38 $ cash per share plus NIL because of no future for minority shares. 

If someone wants to appear as ridiculously naive, just try to post and explain why you would trust Pallinghurst and Gilbertson. Do not explain what they could do but what you trust they will do!

Gilbertson is the one who dares try to rape us when we have power, just imagine what he will do to you when you are a defenceless minority holder.
Note that I will certainly not stay personally as a minority holder of newconsmin, not a single day. On the very first day that I know that the offer is accepted and I am a minority holder despite the fighting I sell.

And I will prove that the minority share will not be worth much.
All those that will be minority holders if the deal happens will spend days and nights thinking "Pallinghusrt may **** me but I trust they won't do it".
And the following day, the same: Pallinghurst may **** me but I trust they won't do it"
And soon the Consmin quote will be down.

Hubisan

hubisan1asp@free.fr


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## Rimtalay (13 June 2007)

*ConsMin rebels seek inquiry*
Kevin Andrusiak 
June 13, 2007 

DISSIDENT Consolidated Minerals shareholders are pushing for an investigation by regulators into the miner's commodity pricing market updates, as industry experts continue to forecast higher manganese and chromite prices.
ConsMin is in the midst of September quarter manganese and chromite contract negotiations - tipped to be concluded by the end of the month - but a growing group of angry shareholders are ramping up opposition to a Pallinghurst Resources $625 million scheme of arrangement that has been endorsed by the ConsMin board. 

The deal with Pallinghurst Investor - a specialised investment vehicle of the Brian Gilbertson-led private company - would see ConsMin give up 60 per cent of the company in return for $1.38 a share and two shares in NewConsMin for every five held in the existing company. 

It is understood dissident shareholders have approached a number of top-10 shareholders with assurances from some that they will not endorse the bid. 

Pallinghurst needs support from at least 75 per cent of shareholders for the scheme to be successful. 

Glenn Stedman, a Queensland shareholder who runs the website Consolidated Minerals Takeover Vote No, said many investors were upset the ConsMin board had not managed to drag out a higher bid from Pallinghurst, which was getting the West Australian miner for a bargain. 

There was some market talk that a rival bid for the company was brewing, but industry sources said it was nothing more than gossip at this stage. 

"The contact I have had with shareholders is definitely no to the bid. 'Not in a month of Sundays' is what one major investor told me," Mr Stedman said. "The price is the biggest factor, but no one really wants to lose control of the company." 

"I can't understand why management was so quick to accept the bid." 

ConsMin's recent market guidance, released early April, said it expected to receive an average manganese price of $US2.50 per dry metric tonne unit. 

PriceWaterhouseCoopers, which provided the independent expert's advice that the bid was not fair, but reasonable, used a $US3.30dmtu price for manganese in 2007 second-half forecasts and a long-term price of $US2.50dmtu. 

Consolidated Minerals closed up 7c to $2.80 yesterday, outside of PWC's $2.33 to $2.77 valuation of the ConsMin business per share. The nominal value for the Pallinghurst bid now stands at $2.50.


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## noirua (13 June 2007)

Rimtalay said:


> *The Vote No campaign is now in top gear.*
> Two of the top 5 holders have now confirmed they will vote NO.
> *NOTE*
> AMCI is based in the Cayman Islands as is Pallinghurst Founder LP.  Pallinghurst Investor is in the process of becoming incorporated in the Netherlands ie. Netherlands Antilles. This may have significant tax consequences for Australia . The arrangements in the
> ...





Hi rimtalay, Some of the above may be misleading, as I do not believe there are the problems you may be suggesting.

AMCI ( American Metals and Coal International ) are based in, Greenwich, Connecticut, United States and are a private company. The largest suppliers of thermal coal in the U.S. They have a substantial holding in Alpha Natural Resources a leading Appalachian Coal Miner. AMCI Consmin (Cayman) LP, Investec and Pallinghurst Resources will hope to form NewConsmin with the current bid on the table. This matter may well have quite a lot longer to play out and a raised bid seems all but certain.
I doubt that there will be any consequences for Aussie investors as it only means that foreign investors can be paid dividends from an International Account and not have to pay Aussie withholding tax.

Investec, one of the partners in the bid, is quoted in London and Johannesburg.


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## Rimtalay (13 June 2007)

Hi noirua
I note you didn't take up the offer to email me for information on the manganese and chrome ore pricing. Plus proof the management is doing deals far above those reported or announced.
Re: The info on Netherlands Antilles, why do you think Pallinghurst wants to incorporate there.
If they are able to set up as such that they can keep the ownership % in any identity less than 10%, then they pay no capital gains tax in Australia on any share transaction.
These people are not stupid, they know all the corporate laws and how to get around our Aust tax laws. Anyone who doesn't realise that is a fool.


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## noirua (13 June 2007)

Rimtalay said:


> Hi noirua
> I note you didn't take up the offer to email me for information on the manganese and chrome ore pricing. Plus proof the management is doing deals far above those reported or announced.
> Re: The info on Netherlands Antilles, why do you think Pallinghurst wants to incorporate there.
> If they are able to set up as such that they can keep the ownership % in any identity less than 10%, then they pay no capital gains tax in Australia on any share transaction.
> These people are not stupid, they know all the corporate laws and how to get around our Aust tax laws. Anyone who doesn't realise that is a fool.




Hi rintalay, Not every country has capital gains tax, New Zealand for instance. 
If a company is not incorporated in Australia or an individual lives outside Australia, they are not liable for Australian Capital Gains Tax ( providing they did not buy or sell whilst "a resident" of Australia, etc). 
I'm pleased to receive information via "private messages", on ASF.

All companies have their Lawyers and often a director covers this post. I doubt any miss a trick.


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## Rimtalay (15 June 2007)

*Talk of split over $625m ConsMin bid * AUSTRALIAN FINANCIAL REVIEW
Michael Vaughan    
Consolidated Minerals managing director Rod Baxter has denied suggestions of a split on the company's board in relation to a $625 million takeover offer from Brian Gilbertson's Pallinghurst Resources.
It came as industry sources said some members of the board were no longer comfortable with the proposal and suggested some directors wanted chairman Dick Carter to resign.
"There's no suggestion at all of any split on this [issue] and the board maintains its support as previously indicated for the transaction, in the absence of a superior offer," Mr Baxter said.
There have been reports of opposition from retail shareholders since the release of the scheme booklet for the proposal after the close of trade last Friday.
However, major shareholders have been reluctant to go on the record.
An independent expert's report from PricewaterhouseCoopers said the Pallinghurst consortium's offer for 60 per cent of the company was not fair but was reasonable.
It advised shareholders to accept the bid but said there was no way of evaluating the potential benefits that ex-BHP Billiton chief executive Mr Gilbertson would bring to the deal.
When Mr Gilbertson was in Sydney a fortnight ago, he indicated there were a number of proposals he was working on that would transform the ConsMin.
The scheme document says the board has already seen presentations on certain of Mr Gilbertson's ideas, although none were binding.
PricewaterhouseCoopers valued ConsMin at between $2.33 and $2.77 a share and said the Pallinghurst bid implied a value of $2.50 a share.
A vote on the bid will take place on July 19, at which 75 per cent of shareholders must support the proposal for it to proceed.
The biggest contributor to ConsMin's earnings is it's Woodie Woodie manganese mine in Western Australia. 
The company expects to produce between 900,000 and 925,000 tonnes of the steel-making material this year.
The price of manganese has risen sharply in the past two months and ConsMin's current pricing guidance expires at the end of June.
However, in the scheme booklet ConsMin provided its view of the forward manganese market.
It indicated it expected to achieve a manganese price of $US3.30 a dry tonne in the second half of the year, up from $US2.50 in the current half.
In 2008, it forecasts the price will fall to $US2.70 and $US2.60 for the following two years.
A report from metals price news service Ryans Notes at the start of the week said ConsMin ore has achieved a price of $US7.40 a dry tonne for the third quarter.
Mr Baxter denied the company was receiving that price but said all indications were that prices had risen from the first half of 2007.
ConsMin expected negotiations for the next quarter to conclude at the end of this month.
Shares in ConsMin firmed 1 ¢ yesterday to $2.80.


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## kerosam (15 June 2007)

Can't rem which broker, but there is a recommendation to buy in today's West Australian for CSM. I'm a bit disappointed that it ended below $2.70 today though 

A bit of selling happening. Maybe I should stock up 

Anyone holding CSM, accumulating?


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## ta2693 (15 June 2007)

I want to top up, but I can not do this for risk control reason. I have had maximum I can have which account for around 10% of my total portfolio.


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## Lachlan6 (16 June 2007)

Technically, (CSM) is right at a crucial junction of support. The uptrending line from Jan 07, along with the medium term EMA and crucial 38.2% fibonacci retracement level, need to hold the stock up, otherwise get ready for bigger falls. Notice the divergence in RSI with the April and May high's this year, which pretty much started this fall from $3.0.

However holders of CSM don't panic yet as the Elliott Wave count is still valid, and the chances are there that it will reverse at this level to now run higher and potentially challenge the old high's. However in saying that I sold last week and shifted into better plays and would only look again if this shows any sign of turing around. Very interesting times at CSM.


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## Rimtalay (16 June 2007)

It's all about to happen, just sit back, watch and wait.

*Noble in ConsMin spotlight*

Hong Kong commodities trader Noble Group is believed to be weighing up an alliance with the mystery consortium circling WA miner Consolidated Minerals in a bid to trump Brian Gilbertson’s floundering take-over plans.

It is understood that Noble chief executive Richard Elman met senior representatives of the mystery group in Hong Kong this week. Noble, which still holds more than 6 per cent of ConsMin, is considered to be a possible cornerstone backer of a rival offer for the struggling nickel and manganese producer.

Though Noble remains one of ConsMin’s biggest shareholders, it halved its stake nearly two years ago at the Princely sum of $3. 90 a share, or 40 per Cent more than the stock’s $2.71 close yesterday.Noble originally picked up its holding for just 20c a share in 1997 to cancel a $US2.5 million ($2.9 million) debt owed by ConsMjn’s failed Predecessor, Valiant Consolidated. Three months ago, Mr Elman sensationally quit the ConsMin board, ostensibly because of the “increasing demands” of his other business commitments.

However, industry insiders say he was unhappy with the modest terms of the offer put by Mr Gilbertson’s Pallinghurst Resources. Pallinghurst is offering just $l.38 in cash for every ConsMjn share, plus two shares in a “new ConsMin” for every five held in the current vehicle.

The offer will see investors receive just $320 million fur a controlling 60 per cent stake in the company they already own, though it will be bolstered by the greater financial and deal-making clout of Mr Gilbertson and fellow backer AMCI coal baron Hans Mende.

It is expected that any Noble-backed bid for Cons Mm would have the support of its former chief executive and fbunder, Michael Kiernan, who would be offered the chance to regain the helm of the company he was forced to quit last year. Mr Kiernan yesterday stepped down as chairman of uranium explorer Uran due to the increasing “pressure of work”. Mr Kiernan is on the boards of seven public companies, including his gold flagship Monarch Gold and Noble-based groups Territory Resources and Precious Metals Australia.

“I suspect my future may be a bit buy,” he said.


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## kerosam (16 June 2007)

*Re: CSM - Consolidated Minerals (Rim & Lach)*

i hope this is true Rim! it seems anything M. Kiernan touches turns into gold.  

if it ever hits its high of $3.90, gone will be my car debt : 

Lachlan6, what does RSI and Elliot Wave indicate? All i know is they are traders' indicators (out of many).


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## Sean K (16 June 2007)

Lachlan6 said:


> Technically, (CSM) is right at a crucial junction of support. The uptrending line from Jan 07, along with the medium term EMA and crucial 38.2% fibonacci retracement level, need to hold the stock up, otherwise get ready for bigger falls. Notice the divergence in RSI with the April and May high's this year, which pretty much started this fall from $3.0.
> 
> However holders of CSM don't panic yet as the Elliott Wave count is still valid, and the chances are there that it will reverse at this level to now run higher and potentially challenge the old high's. However in saying that I sold last week and shifted into better plays and would only look again if this shows any sign of turing around. Very interesting times at CSM.



Lachy, disregarding EW (maybe fateful) the S&R  lines I see do not correspond to your EW retractments. I always look at this for some sort of validity/fidality/confirmation of EW counts. They _should _ be in sync to have a higher probability of correctness. 

There should be minor support at $2.60, but I think $2.70 was the key. Next level is $2.40 IMO.

But, under this merger debarcle, T/A flies out the window, perhaps.


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## kerosam (17 June 2007)

read the article rim posted on today's papers.

some glimpse of hope. 

Rim, u think this news is made known to whole Australia or the West Australian? Next week might be interesting.


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## Rimtalay (17 June 2007)

Don't worry about that, ConsMin vote No team members are spreading it everywhere, you can even read it at Advanced Financial in the UK.
Don't worry we don't miss a trick. All the big holders and newspapers will know by Monday.
Let the games begin.


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## Lachlan6 (17 June 2007)

Gday Kennas. I still see the EW count validated on the (CSM) chart without a doubt. However upon bringing up the weekly chart, I found this was the retracement we had to have (Scary sounding a little too much like Paul Keating) as it was only 1 cent short of the 50% level from July 2005 highs to 06 lows. It is AMAZING how accurately this 50% level works. This is why I have the upmost respect for WD Gann and his principles. 

Another cracker example which I got out of at $3.37 (scaled in posi) is (MCP). Check this 50% level again from the 2005 highs to 06 lows. Only 2c off this 50% level before retracing.


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## Rimtalay (17 June 2007)

*Price Of Chinese Silico-Manganese Has Risen To US$1,650 / Ton CIF Japan As Highest  *
= *Reflecting Steeply Risen Domestic Price And View To Raise Electric Power Fees From July *
The price of Chinese silico-manganese for export has strengthened again a power to rise further from last week and is being offered at US$1,600 - 1,650 per ton CIF Japan as a further rise from that ( US$1,500 - 1,550 CIF ) prevailed on the end of May.

*An anxious feeling of the difficulties to secure ( to import ) manganese ore as raw material has deepened in domestic market of China *and price of Chinese silico-manganese transacted in domestic market has risen to CNY9,800 - 10,000 per ton at present. Reflecting a tightness on supply of silico-manganese, payment term is mainly on cash base.

On the basis of this CNY price, FOB China price on US$ base is calculated to be US$1,420 - 1,430 per ton, including export duty, and even when US$30 per ton of ocean freight and other charges are added to this FOB price, price of Chinese silico-manganese on CIF Japan base will come to be about US$200 per ton lower than that currently offered for Japan as mentioned above. This differential of US$200 per ton has included an expectation of higher prices for silico-manganese in the near future and speculative purchases of silico-manganese by steel trading companies in China.

However, it has been rumored in China that basic fees of electric power will be raised from July, and the factors to increase costs for production of silico-manganese in China are too numerous to mention. The Central Government of China has already enforced differential fees of electric power by 4 times in the past years and the latest enforcement from January of 2007 is to add CNY0.15 per 1 KWH to the basic fee applied to the industries to be curtailed and CNY0.04 per 1 KWH to the basic fee applied to the industries to be restrained. Consequently, the current fees of electric power for industrial purpose used by major producers of ferro-alloys in China are estimated to be in the range of CNY0.42 - 0.45 per 1 KWH.  
last modified : Fri 15 Jun, 2007 [10:24]


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## Rimtalay (18 June 2007)

Monday, 18 June 2007


*IF THERE really is a second takeover bid looming for troubled manganese miner Consolidated Minerals, Dryblower wonders why the share price is falling?*


That was the question which occupied much thinking late last week as reports circulated of a rival move on ConsMin, and investors were busy clipping 17c off the share price.

After opening at $2.80 on Friday, ConsMin fell to close at $2.63.

What made that 6% fall so interesting is that Friday was the day speculation hit fever pitch that the second takeover syndicate, led by former chief executive Michael Kiernan, would ride in to do battle with the original bidder, a group led by former BHP Billiton boss Brian Gilbertson.

At the risk of stating the obvious, when there are two bids for the same business, and both seem well funded and aggressively led, and the share price of the target is falling, something's wrong.

Either the market has overpriced ConsMin in the excitement of the convoluted first bid from the Gilbertson group.

Or there is no rival bid.

Or the board of ConsMin is in disarray and investors are ducking for cover.

Whatever the current situation, and the next few days should throw more light on the fate of the company, there is a simple reason for most of the angst inside a business which should be enjoying boom times as the manganese price rises – but which has now seen its share price fall by 13% since it peaked this year at $3.03 on May 30.

That reason is the "not fair, but reasonable" verdict of an independent export looking at the terms of the original bid.

Apart from the absurd complexity of that offer, which culminated in the production of a monster document occupying some 443 pages, there was equally absurd conclusion "not fair, but reasonable".

Dryblower might be old-fashioned but in his world fair and reasonable are two words that go together so naturally that it is impossible to imagine one without the other.

What the experts at the accounting firm, PriceWaterhouseCoopers seem to be saying is that the Gilbertson-led bid is ok, sort of.

But in the same sentence, they're saying with absolute clarity that the deal isn't fair – a word which, when tested, also means adequate.

Little wonder that there have been stories circulating of ructions inside the ConsMin board.

How on earth could any director stand before shareholders, the people whose money he's managing, and defend a takeover offer which an independent expert has found to not be adequate, sorry, fair.

But recommend and defend the board has done. The chairman, Dick Carter, says precisely that in his two-page letter inside the bid document.

The core of Carter's argument is that Gilbertson, and his team, have the ability to lift ConsMin to greater heights with their deal-making capacity – to which Dryblower says "what deals?" because as far as he can see there's no detail of what lies ahead. 

Carter will have his chance to explain in person why he wants to see ConsMin become 60% owned by the Gilbertson syndicate at a series of shareholder and optionholder meetings on July 17.

Between now and then, there is plenty of opportunity for the troubles brewing beneath the surface to bubble over.

That, to Dryblower, is why some investors are taking their money off the table and selling ConsMin shares.

The next question, of course, is who's buying?

It doesn't require too much imagination to see the Kiernan-led rival group using the confusion in the market to soak up a handy position in ConsMin – and it doesn't need too many shares to torpedo the Gilbertson group given that it needs a 75% vote in favour.

At this point, while thinking about what might happen, Dryblower's head is starting to feel as stuffed full of numbers and possibilities as the 443-page PriceWaterhouseCoopers report, and he can tell you that's neither fair, nor reasonable – just confusing.


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## bigtbigt (18 June 2007)

Hi - I'm a newbie on this bb. A UK investor in cnm. Perhaps you guys might want to join our UK chats on http://www.iii.co.uk

Anyhow, here's a little bit of news (you may or may not have seen)...

-----
From the West Australian Newspaper Saturday 16th June 07

Noble in ConsMin spotlight

Hong Kong commodities trader Noble Group is believed to be weighing up an alliance with the mystery consortium circling WA miner Consolidated Minerals in a bid to trump Brian Gilbertson’s floundering take-over plans.

It is understood that Noble chief executive Richard Elman met senior representatives of the mystery group in Hong Kong this week. Noble, which still holds more than 6 per cent of ConsMin, is considered to be a possible cornerstone backer of a rival offer for the struggling nickel and manganese producer.

Though Noble remains one of ConsMin’s biggest shareholders, it halved its stake nearly two years ago at the Princely sum of $3. 90 a share, or 40 per Cent more than the stock’s $2.71 close yesterday.Noble originally picked up its holding for just 20c a share in 1997 to cancel a $US2.5 million ($2.9 million) debt owed by ConsMjn’s failed Predecessor, Valiant Consolidated. Three months ago, Mr Elman sensationally quit the ConsMin board, ostensibly because of the “increasing demands” of his other business commitments.

However, industry insiders say he was unhappy with the modest terms of the offer put by Mr Gilbertson’s Pallinghurst Resources. Pallinghurst is offering just $l.38 in cash for every ConsMjn share, plus two shares in a “new ConsMin” for every five held in the current vehicle.

The offer will see investors receive just $320 million fur a controlling 60 per cent stake in the company they already own, though it will be bolstered by the greater financial and deal-making clout of Mr Gilbertson and fellow backer AMCI coal baron Hans Mende.

It is expected that any Noble-backed bid for Cons Mm would have the support of its former chief executive and fbunder, Michael Kiernan, who would be offered the chance to regain the helm of the company he was forced to quit last year. Mr Kiernan yesterday stepped down as chairman of uranium explorer Uran due to the increasing “pressure of work”. Mr Kiernan is on the boards of seven public companies, including his gold flagship Monarch Gold and Noble-based groups Territory Resources and Precious Metals Australia.

“I suspect my future may be a bit busy,â he said.
-----


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## Rimtalay (19 June 2007)

WWW.MININGNEWS.NET dryblower 
*ConsMin and its falling share price *


Monday, 18 June 2007


IF THERE really is a second takeover bid looming for troubled manganese miner Consolidated Minerals, Dryblower wonders why the share price is falling?


That was the question which occupied much thinking late last week as reports circulated of a rival move on ConsMin, and investors were busy clipping 17c off the share price.

After opening at $2.80 on Friday, ConsMin fell to close at $2.63.

What made that 6% fall so interesting is that Friday was the day speculation hit fever pitch that the second takeover syndicate, led by former chief executive Michael Kiernan, would ride in to do battle with the original bidder, a group led by former BHP Billiton boss Brian Gilbertson.

At the risk of stating the obvious, when there are two bids for the same business, and both seem well funded and aggressively led, and the share price of the target is falling, something's wrong.

Either the market has overpriced ConsMin in the excitement of the convoluted first bid from the Gilbertson group.

Or there is no rival bid.

Or the board of ConsMin is in disarray and investors are ducking for cover.

Whatever the current situation, and the next few days should throw more light on the fate of the company, there is a simple reason for most of the angst inside a business which should be enjoying boom times as the manganese price rises – but which has now seen its share price fall by 13% since it peaked this year at $3.03 on May 30.

That reason is the "not fair, but reasonable" verdict of an independent export looking at the terms of the original bid.

Apart from the absurd complexity of that offer, which culminated in the production of a monster document occupying some 443 pages, there was equally absurd conclusion "not fair, but reasonable".

Dryblower might be old-fashioned but in his world fair and reasonable are two words that go together so naturally that it is impossible to imagine one without the other.

What the experts at the accounting firm, PriceWaterhouseCoopers seem to be saying is that the Gilbertson-led bid is ok, sort of.

But in the same sentence, they're saying with absolute clarity that the deal isn't fair – a word which, when tested, also means adequate.

Little wonder that there have been stories circulating of ructions inside the ConsMin board.

How on earth could any director stand before shareholders, the people whose money he's managing, and defend a takeover offer which an independent expert has found to not be adequate, sorry, fair.

But recommend and defend the board has done. The chairman, Dick Carter, says precisely that in his two-page letter inside the bid document.

The core of Carter's argument is that Gilbertson, and his team, have the ability to lift ConsMin to greater heights with their deal-making capacity – to which Dryblower says "what deals?" because as far as he can see there's no detail of what lies ahead. 

Carter will have his chance to explain in person why he wants to see ConsMin become 60% owned by the Gilbertson syndicate at a series of shareholder and optionholder meetings on July 17.

Between now and then, there is plenty of opportunity for the troubles brewing beneath the surface to bubble over.

That, to Dryblower, is why some investors are taking their money off the table and selling ConsMin shares.

The next question, of course, is who's buying?

It doesn't require too much imagination to see the Kiernan-led rival group using the confusion in the market to soak up a handy position in ConsMin – and it doesn't need too many shares to torpedo the Gilbertson group given that it needs a 75% vote in favour.

At this point, while thinking about what might happen, Dryblower's head is starting to feel as stuffed full of numbers and possibilities as the 443-page PriceWaterhouseCoopers report, and he can tell you that's neither fair, nor reasonable – just confusing.


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## Rimtalay (20 June 2007)

*Manganese ore remains at historic highs despite thin trading*
BEIJING (Metal-Pages) 19-June-07. The Chinese manganese ore market remains steady at historic highs, although a slowdown in demand from alloy makers has led to a thin market, according to industry sources. 

Spot prices are around Rmb62-65/mtu for high grade lumpy material with Australian origin, while import prices are being quoted at $6.3-6.5/mtu CIF China. Values were just at Rmb25-27/mtu and $2.6-2.8/mtu CIF at the beginning of this year. 

“Tightness in global supply and high offers from overseas suppliers are continuing to support the market, although manganese alloy markets have been falling,” said a manganese ore seller in China. 

A trade source described the market as thin, adding. “At present manganese smelters are in hot water. They are unsure if they can make profit if they buy in the high-priced raw material.”

“Overseas suppliers seem to be very upbeat as global production has yet to improve much over the past year,” a second trader said. “But sooner or later the ore market will be affected if the alloy markets continue to struggle, as China consumes the largest part of the world production.”

China’s imports of manganese ore totalled 1.89 million tonnes in the first four months of 2007, which was 30% over last year’s amount, according to Chinese Customs.


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## huddpy (21 June 2007)

hello from england.

just finding my way round here trying to make sense of cnm at pres.

outed my holding as it looks as if this t/o is going to be forced through, not a happy ted.

any info appreciated.

hud.


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## kerosam (21 June 2007)

received the booklet scheme today. a bit too much to read even during the weekend is coming.

question to the floor, if there's another rival bid, when is the closing date or if there's one, for the rival to make an offer? well, the volume these few days are not pointing towards that happening though.


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## Rimtalay (21 June 2007)

huddpy, I doubt that the deal will pass at the present price, there is already 16% of the vote of big holders against the vote. No shareholder will benefit from the deal. Only an idiot would accept the deal as it stands, and I doubt whether many idiots have a lot of shares.
The management have almost no shares, Mr Richard Elman of Noble Group quit the board as he would not support the vote. He is with Mr Michael Kiernan presently looking at a counter bid.
The big holders already realise that manganese is up more than in early 2005 and that  alone will propel ConsMin to $4-$5/share. There is NO risk, I say NO risk. Manganese and Chromite will blow ConsMin out of the water next year, you could be looking at $200 million profit on contracts presently being settled for next year. Nickel is a little more unsure, the production will be ramped up with 132N coming online, but it may only add 1000 tons to the total, they should be getting into higher grades shortly at the other mines, so 6000 tons will be about the total for next year. And the nickel price could be back down to the US$14/lb level next year, but who knows it could also be back to US$24/lb. 
But manganese is the thing, just read the Manganese Institute conference papers presently being held in Vienna, and you'll know why.  
Don't forget ConsMin has the only chrome ore mine in Australia, and India and South Africa are trying to stop all exports of chrome ore, they'd rather that companies value-add it to ferro-chrome. Chrome ore will add another $20 million profit.
The only thing to worry about is all the suckers and the sheep, who'll sell it down trying to get out before the vote. Other words, they have  NO GUTS, OR NO BRAINS


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## Sainter (21 June 2007)

An email I sent to the ASX the other day, in response to an email I had received from them to my earlier complaint...

I feel the role of the ASX in relation to the CSM scheme of arrangement appears to be one of a toothless tiger. That is not a slight on the people or the company itself, but rather that there is a large hole through which the director and CEO of any company can avoid giving timely and accurate information. The ASX takes the position that their jurisdiction is limited, and that the timely disclosure rules are "superseded by the requirements of the Corporations Act and the onus of the independent expert's to form a view on the adequacy and reasonableness of the offer".  Unfortunately, the fact that independent "experts have relied on information from the directors" rather than undertake sufficient investigations themselves, means there exists the opportunity for directors/CEOs to unreasonably influence the outcome of the "independent" report. This influence could come from omission of information rather than any deliberate lying. This presents an opportunity for unethical directors/CEOs who stand to gain personally from such an omission. I stress that this is a general statement and not _necessarily _indicative of the actions of the board and CEO of CSM. However, it is clear that they stand to benefit from such a transaction with Pallinghurst going through, and therefore their position is unquestionably compromised. In such situations I feel the ASX should be trying, through all available means, to protect shareholders from any potential unscrupulous dealings.  

In the case of CSM, it has historically been a manganese stock, that is, manganese is its main commodity. It was the major contributor to H1 07 EBIT (p5, ASX presentation 23/2/07). However, manganese pricing is 'murky'. The manganese price has gone up from US$2.85 in March this year to US$6.35 per manganese unit (dmtu) CIF on June 14 this year. Given it seems CSM negotiate prices every quarter, this dramatic rise has not yet been put to the market by CSM, possibly because it has not been finalised. Based on a recent article in the AFR on June 15 (Talk of split over $625m ConsMin bid, by  Michael Vaughan), I believe they are currently in discussions regarding setting contract prices for next quarter. CEO Mr Baxter stated that "indications were that prices had risen from the first half of 2007", although he did not state the magnitude of the rise. However, a rise similar to what I've just described will clearly have a dramatic effect on the income and profit for CSM, yet the magnitude of this rise has not been adequately disclosed to the market. Can I suggest the ASX ask CSM to state the current manganese market price as quoted by a reputable source, eg Ryan's notes (see Rimtalay's emails for this information) and at the same time get them to state what their contracts have been set at over the past year. I feel this would not force CSM to disclose their "inner workings" regarding contract negotiations, but would allow the 'mum and dad' shareholders to appreciate the marked increase in manganese prices over the current quarter.

To give you a bit of an understanding, below is a comparison of manganese market prices (CIF) and CSM-received prices (FOB) over the past year. Based on the current negotiations, I assume the price in the month preceding each quarter is of most relevance.

July '06-Dec '06: CSM = US$2.10/dmtu, FOB.  Mn price May '06 to October '06 = US$2.30-2.45 CIF
Jan '07 -June '07: CSM = ~US$2.5/dmtu, FOB. Mn price mid Nov '06 to end March '07 = US$2.70-2.90 CIF.

This means conversion of CIF to FOB costs about US$0.3-0.4 per dmtu. Even of this increases 100%, it still is only US$0.6-0.8/dmtu.
The current CIF price for June '07 ranges from US$4.90-5.20 at the start of the month to US$6.20-6.50 now. As you can appreciate, the FOB price negotiated in June should be in the range US$4.10 to US$5.70. At the low price of $4.10, this is still 60% above the price received in the last half, all of which essentially becomes profit. After mining costs, this means an increase from about A$9.5M per quarter to A$32M before tax and corporate overheads, even at the low price. Clearly the extra $22M drops to the bottome line after tax, or about $15M NPAT EXTRA in ONE quarter. To put that in perspective, H1 NPAT for ALL operations was only $10.2M. That is why I feel this development is material and requires the ASX to pursue CSM and get them to reveal this manganese pricing information.

I look forward to your response on this matter.


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## Sainter (21 June 2007)

CSM hides behind freight costs to mask the true value of manganese to them. They quote FOB but do not give a way to convert that to CIF which are the prices Rimtalay quotes us.
Well, my above post has the answer, but in case you missed it, I'll repeat it here, with PROOF.


Below is a comparison of manganese market prices (CIF) and CSM-received prices (FOB) over the past year. Based on the current negotiations, I assume the price in the month preceding each quarter is of most relevance.

July '06-Dec '06: CSM = US$2.10/dmtu, FOB.  Mn price May '06 to October '06 = US$2.30-2.45 CIF (lowest and highest traded prices)
Jan '07 -June '07: CSM = ~US$2.5/dmtu, FOB. Mn price mid Nov '06 to end March '07 = US$2.70-2.90 CIF (lowest and highest traded prices).

So, conversion of CIF to FOB in 06/07 costs about US$0.3-0.4 per dmtu. Even of this increases 100%, it still is only US$0.6-0.8/dmtu.

The current CIF price for June '07 ranges from US$4.90-5.20 at the start of the month to US$6.20-6.50 now. So, the FOB price negotiated in June should be in the range US$4.10 to US$5.70. At the low price of $4.10 FOB, this is still 60% above the price received in the last half, all of which essentially becomes profit. In a year, this means the profit due only to the manganese operation, after mining cost but before corporate overheads, is $128M.
At the price of US$5.70 FOB for a year, profit due only to the manganese operation, after mining cost but before corporate overheads, is $220M.

It is not unreasonable to expect that CSM could earn $150M+ AFTER TAX next financial year, putting it on a PER of 4 or less, or EPS of 67 cents. Why would I give 60% of that away at a discount price???  

Assumptions: exch rate 84c.
6k t Ni @US$35k/t, cash cost A$8.
1M t manganese, US$4.70/dmtu FOB, cash costs A$2.2
250k chromite, US$320/t FOB, cash cost A$123.5/t.
Selling/admin finance costs $85M.


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## Rimtalay (22 June 2007)

*In the scheme document *
A) Did ConsMin management tell shareholders that JML has gone up 60% since the takeover announcement in Feb? NO
B) Did ConsMin management tell shareholders that BCI has gone up 250% since the takeover announcement in Feb? NO
C) Did ConsMin management tell shareholders that manganese ore prices have gone up 120% since the announcement? NO
D) Did ConsMin management tell shareholders that they plan to steal their shares?  NO
E) Did ConsMin management tell shareholders that they plan to hand Gilbertson $170 million profit before shareholders break-even? NO

VOTE NO


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## kerosam (24 June 2007)

send out my vote this morning.

should we start to look at the possible candidates for new management??? 

hopeless bunch! bring kiernan back!!!!!!


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## Sainter (25 June 2007)

So Gilbo ups the price by 30 cents per share (+ the 4.5 c divvy). Well, at the increased Mn price, he just about gets all the 30 cents back (guaranteed) in one quarter of manganese mining!
IF Mn stayed at that very good price for the year (US$7.35), that equals ~$270M after mining costs, and using all my other assumptions in the earlier post on June 21, then CSM is in line to earn $220M NPAT, or 97 cents per share. Sorry Gilbo, still not enough.

Cheers!


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## kerosam (25 June 2007)

pretty stingy 30cts i reckon.

possible reflection that our knight in shining armour is far far away! buy volumes building up though.


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## porkpie324 (25 June 2007)

What a difference good management makes, during the Tethyen copper co takeover offer the management were working for their shareholders and an excellent result for loyal shareholders came through in the end, I'm still holding my CSM shares at least until a better offer comes along and it will, porkpie


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## kooka873 (26 June 2007)

Hi folks,

Received my offer document yesterday - what a disappointment & expensive exercise it all is.

Really appreciate Sainters well researched intelligent comments & motivation in the matter, along with others participation in this forum.

Despite yesterdays announcements I've made my stand at what I think of the deal & voted with a firm "NO".

Regards

Kooka


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## Sultan of Swing (26 June 2007)

I received my 'Scheme Booklet' today....

Since when is a 432 page document of fine print a 'booklet'?????? 

What a joke. What are they hiding in there that a layman like me will never find or understand?

The one thing I do understand is why Warren Buffett says to only invest n companies that have good management and are candid about what they're doing. 

Why the heck I bought into CSM I have no idea, it certainly doesn't meet the criteria.

However, I'll continue to hold just for the sake of it for the time being.


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## Rimtalay (26 June 2007)

Vote No team members have said NO, NO WAY.
Too little and too late.
The manganese price is now out in the public arena, and we have to thank all Vote No team members who have hounded and harrassed ASX and ASIC for weeks over the continuous disclosure requirements. Mr Baxter told me ( in writing) that he would NOT update the market for manganese ore pricing.
Now that the manganese ore prices are out in the open, ConsMin shareholders will now benefit and hopefully everyone will vote NO to the deal at the present price.
Manganese will make CSM many of $100's millions next year.
http://www.stockinterview.com/News/06262007/stealth-bull-market-manganese.html
Good luck for all ConsMinb holders and thanks for everyones support.


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## sylar (27 June 2007)

Attention ALL CSM shareholders!!!!!!!!!!!!!!!!

Just read through the proxy form they sent out and it states the following:


"I/We being a member/s of Consolidated Minerals Limited and entitled to attend and vote hereby appoint (Chairman or individual or body corporate)"

At this point the Chairman or individual or body corporate will vote as you direct them on the form. i.e. tick AGAINST


continues on...

"failing the individual or body corporate named or if no individual or body corporate is named, the Chairman of the Meeting, as my/our proxy to act generally at the meeting on my/our behalf and to vote in accordance with the following directions"

So if you fail to nominate the Chairman or individual or body corporate as your proxy, the Chairman of the Meeting will be automatically assigned as your proxy.



continues on....

"(or if NO directions have been given, AS THE PROXY SEES FIT)"

Below the voting box section it states:

The Chairman of the Meeting intends to vote undirected proxies in FAVOUR (i.e. FOR) of the item of business.  


Which means he will approve the Share Scheme on your behalf, so if you do not direct them they will assume that you are FOR the TAKEOVER. Hence by not filing out the proxy form you are automatically VOTING FOR the takeover!!!


Hence why everyone needs to appoint the Chairman or individual or body corporate as their proxy if they are unable to attend and tick the AGAINST box, then the Chairman must put your votes (remember every share you hold counts as a vote) in the AGAINST column, preventing the takeover from going ahead!!!!!


HENCE EVERYONE WHO HOLDS CSM SHARES NEEDS TO COMPLETE THE FORM THE SEND OUT AND SEND IT BACK FOR YOUR VOTES TO COUNT AGAINST THE TAKEOVER!!!!


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## Rimtalay (27 June 2007)

Yes, please everyone make sure that you complete the proxy form and vote against the proposal.
But I haer that Baxter will not attend the Xmas Party this year


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## Col Lector (27 June 2007)

CSMsters...This link is a good read. A must read before voting. Detailed commentary on state of Mn market, and future prospects. Very bullish.Comments on growing use of manganese as nickel substitute in stainless production are v.interesting. 
http://www.stockinterview.com/News/06262007/stealth-bull-market-manganese.html


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## noco (27 June 2007)

Iam with you guys to vote no! If Pallinghurst can offer an additional 30 cents, you can bet your boots this will be on the lower end of the scale. I believe they can offer more.The 30 cents is for the "suckers".


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## kerosam (27 June 2007)

looks like someone in the media (west australian) has a tag on CSM. the paper had half-page write up on CSM yesterday and today. A bit by AFR (yesterday & today) as well... mostly on possible Kiernan as a rival bid.

did anyone read the today's CSM ann? it just strengthen the fact that this management SUCKS!


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## Sainter (28 June 2007)

Oops, duplicate posting, so I'll find something relevant to say with 100 or more words. If the MK/Noble bid is only $3 it still grossly undervalues the company and I would still reject it. But that would leave me with Baxter in charge. What to do, what to do? Sit tight and hope for a bidding war I suppose.


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## Sainter (28 June 2007)

It is a topical issue ATM. The 'interesting' angle from the paper's perspective is the strong public opposition to the deal, led extremely well by Rimtaly. It is a real 'David and Goliath' battle which the papers like to report on. Having said that, anyone with an IQ even approaching three figures can see Baxter is shafting shareholders for his own self interest. His withholding of the manganese price until after he had informed Pallinghurst who in turn had time to assess the impact and therefore revise their bid is a CRYSTAL CLEAR example of whose side he is on. It amazes me that such blatantly self-serving actions do not result in any action by ASX or ASIC. ASX is as much a watchdog as an ageing grandma stuffed full of valium. OK, they have their 'rules' to follow which render them as effective as a eunuch in a fertility clinic, but crikey, even I suggested to them an action to elicit a public comment from CSM re manganese prices. It's not my job to work on angles the ASX can use to do their job! What do they actually do there?! Or am I just forgetting who they receive their money from? But I digress. The important point is: Never, ever invest in any company associated with Dick Carter of Rod Baxter as they have clearly demonstrated that are not looking out for you, just themselves. They're so far up BG's jacksie, I'm sure they can see daylight. Do not trust these useless ba$t@rd$. I look forward (hopefully) to seeing them get their come-uppance.
Time is 10:58PM WST 070627. How long 'til this post is wiped?:
Cheers!


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## Sainter (28 June 2007)

SMH article.
http://www.smh.com.au/news/business/mining-heavies-poised-for-battle/2007/06/27/1182623991181.html


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## Sainter (28 June 2007)

It's on! The West has an article titled "Territory to launch tilt at ConsMin" 
Seems it will be a $680M+ bid, cash and Territory scrip aimed at about $3/share.
Territory has sought to do DD on the CSM as a prelude to launch a formal takeover offer. Baxter could not be reached for comment early last night. Article finished with an old MK quote "I believe the current management have not operated the assets in the best interests of all shareholders" You can say that again, Mike!

PS I think $3 still undervalues the company by a fair margin, but maybe this is just the start, and if it is the end, then at least I will receive about $3/share AND some justice. Good riddance, Rod......


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## RM8 (28 June 2007)

Just read the AFR. Great news! 

If anyone can pull this off it should be Kiernan. CSM board must have been sweating it out hoping time would be on their side and shareholders would be fooled by the shear size of the offer document.


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## Sainter (28 June 2007)

Offer is $1.5 and 1.5 TTE shares per CSM share.
So, with TTY in a halt at $1.48, then it puts the value of the bid nominally at $3.72/CSM share. But of course that depends on what value you ascribe to TTY as they were 30c half a year ago. Yes, that IS a long time ago in the current environment and given TTY's very recent change to a producer, but I just needed to point that out. The TTY price could be volatile. But $3.72 is a fair bit above $3 mentioned by The West (would require TTY price to be $1) and the Pallinghurst bid (using Pallinghurst's $2.80, then that equals a TTY price of 87c).
I know what my preference is!  Good riddance Rod!


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## Rimtalay (28 June 2007)

The showdown has only started. Whilst Michael Kiernan's bid has thrown ConsMin shareholders a lifeline, it is only the start. I suggest that we vote NO to all deals that are presently on the table.
Gilbertson will not want to walk away empty handed, he tried to steal CSM with baxter and carter's help. Michael Kiernan has his own agenda, he is smart, he is also keeping his ammo dry. 
Gilbertson is sure to up the stakes, at which time Kiernan will now doubt bring in the big guns all firing.
So strap in and get ready for the ride.
You have the two biggest guns in the business about to draw on each other. Just sit on the side lines and watch the FUN. The shareprice will only go one way UP.
That's what Vote NO team members want.
Good luck to all CSM holders


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## ta2693 (29 June 2007)

There is one thing I do not understand. 
If TTY is proposing $3.73/ share, why the CSM is trading around $3.19?

I think $3.73 could be the base. pallinghust may also lift its bid to compete with TTY. there is also chance for another bidder coming into competition. GS, or Trust supported by Noble group. 

Everyone know CSM is very undervalued now, why the current price is only $3.19?


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## Rimtalay (29 June 2007)

Hi all CSM holders.
ConsMin management has just rejected the bid from TTY. They are worried they will lose their jobs.
Email baxter NO and tell him your not happy.
Give him hell
rbaxter@consminerals.com.au
NOW


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## Sainter (29 June 2007)

Shareholders own this company, not Baxter OR the board. We demand the right to decide which offer is the better one.


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## Sainter (29 June 2007)

I just fired this off. I expect no response, as usual.

Mr. Baxter,

I send this email to remind you that shareholders own this company, not you OR the board. Your basis for rejecting the TTY bid on finance issues did not appear to take into account the debt or dilution the Pallinghurst deal will foist upon us once Mr. Gilbertson starts buying things. You also forgot to work out or mention that our stake in JML is worth some $200M, the sale of which, after tax, would cover half of the $1.50 cash component proposed by TTY.

Regarding the uncertain value of TTY shares, your points are, on the surface, valid. However, I'm sure you and the board must be aware that this is in effect a reverse takeover-the principle assets would be existing CSM assets, so if anything, the deal should be valued on CSM scrip moreso than TTY scrip. And currently CSM is being held back by the threat of the inadequate Pallinghurst bid getting up. You must know that, along with knowing the TTY deal would allow CSM shareholders to retain majority control of the new entity, another difference in the two deals on offer. This deal is immeasurably better for CSM shareholders than the grossly inadequate Pallinghurst deal. I feel however that you also know the TTY deal is bad for you and certain board members, hence your decision to reject this offer. You are again thinking of yourself and not the people you work for-the shareholders. Shame on you.


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## rhen (29 June 2007)

Thanks Sainter and others,

I have copied and pasted your "Mr Baxter" letter (Sainter) and emailed it off to CSM. I wonder if a few more similar emails from other members would get a response???
Hope you don't mind Sainter.

regards
rhen

All that is necessary to break the spell of inertia and frustration is this: Act as if it were impossible to fail. That is the talisman, the formula, the command of right-about-face which turns us from failure towards success.  Dorothea Brande


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## kerosam (29 June 2007)

a few questions in mind:

1. Can CSM not co-operate and not allow access for due diligence review?

2. Will shareholders have a say whether who we want as new management if take over is immnient? even when the board has rejected the offer.

not surprising ron & company rejected the offer since they'll be out of a job. but who cares anyway. tables have turned. kiernan is back with a vengence.

why did keirnan left in the first place? can anyone fill me in?


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## porkpie324 (29 June 2007)

I think it was to quote  'persue other opportunities with another company', from memory that is, more than likely leave a good company with idiots then come in again later and pick it up  cheaper, porkpie


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## Sainter (29 June 2007)

Rhen,
No problems mate. Glad to hear you did so in fact. But Baxter I think has thick skin. It would take a bit more than that to perturb him. I do have a speech in mind for the meeting, but I know if I said what I was thinking about the Board and CEO (it involves the CEO and board being able to squeeze into, umm, shall we say tight places on Gilbo's person, because they are spineless) they would turn the mikes off and probably evict me!
My holding in CSM is not that large, but this is a matter of principle. I cannot believe ASX and ASIC sit idly by while a CEO can ride roughshod over shareholders, clearly to benefit himself, and not get called to account.


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## Rimtalay (30 June 2007)

Everyone email Baxter and tell him what you think of him, we have to do our bit, don't be fence sitters. The fireworks are about to start.
Good story



> June 29, 2007
> *Michael Kiernan Is Not Going To Let Go Of Consolidated Minerals Easily*
> 
> By Our Man In Oz
> ...


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## Rimtalay (30 June 2007)

ALL CSM SHAREHOLDERS - DEMAND THAT TTY CAN CARRY OUT DD
email rbaxter@consminerals.com.au 

*Consolidated Rejects Takeover Proposal From Territory* (Update4) 

By Jesse Riseborough

June 29 (Bloomberg) -- Consolidated Minerals Ltd. rejected an A$849 million ($719 million) cash-and-share takeover proposal from iron ore producer Territory Resources Ltd., favoring a bid from a group led by Pallinghurst Resources Fund LP. 

The value of Territory's shares is ``significantly'' lower than their last traded price, and shareholders' interests were served best by pursuing the Pallinghurst-led bid, Perth-based Consolidated's Chairman Dick Carter said today in a statement. The Pallinghurst group this week raised its bid for the Australian manganese and nickel producer to A$642 million. 

Pallinghurst Chairman Brian Gilbertson, a former BHP Billiton Ltd. chief executive officer, and Territory Chairman Michael Kiernan are battling for control of 10 percent of the world's high-grade manganese used to harden steel. Shares of Perth-based Territory have risen fourfold this year. 

``The proposal from Territory appears to be somewhat opportunistic,'' Macquarie Research Equities Ltd. analysts led by Lee Bowers said today in a note. 

Shares of Consolidated fell 5 cents, or 1.6 percent, to A$3.14 on the exchange at the 4:10 p.m. Sydney time close. Territory shares, which are suspended from trading, last traded at A$1.485 on June 22. 

``The proposal requires our shareholders to accept Territory Resources scrip at a price which the board believes does not reflect'' Territory's value, Consolidated's Carter said in the statement to the Australian Stock Exchange. Kiernan is a former managing director of Consolidated. 

September Shipment 

Territory, aiming to start ore shipments in the September quarter, yesterday confirmed it may bid A$1.50 in cash and 1.5 of its own shares for each share in Consolidated. In April, independent expert BDO Consultants Pty valued Territory's shares at between 35 and 39 cents, Consolidated said today. Territory shares have traded below A$1 until this month, it said. 

The six-month trading average of Territory shares of 63 cents is a more accurate method of valuing the Territory proposal, Macquarie said. Macquarie has an ``outperform'' rating on Consolidated, with a revised price target of $3.50 a share. 

The Consolidated board assessed ``the intrinsic value of Territory Resources shares is significantly lower that its last trading price,'' Consolidated said. ``Therefore the implied value of the proposal would be less than the current Consolidated Minerals share price.'' 

Due Diligence 

Consolidated's rejection of the Territory proposal ruled out any immediate possibility of Territory being able to study Consolidated's finances before formalizing its proposal into an offer, Territory's Kiernan said today by phone. 

We want ``the opportunity to do a brief corporate due diligence,'' Kiernan said. ``We will then put a firm proposal setting out all details to the board,'' by July 16. 

Some unidentified shareholders had said should Consolidated's board continue to decline the Territory proposal an extraordinary general meeting may be called, according to Keirnan. 

The Pallinghurst-led group raised its bid on June 25 and is offering A$1.68 a share in cash plus two shares in a new company for every five Consolidated shares. The bid values the company at A$642 million, up from the previous offer of A$625 million, the group said. Pallinghurst's bid is backed by American Metals and Coal International Inc., and Investec Plc. 

Director Resigns 

Independent expert PricewaterhouseCoopers LLP reviewed the increased offer and considered it to be ``fair and reasonable,'' Consolidated said today in a separate statement to the exchange. 

Consolidated Director Allan Quadrio today resigned from the company to avoid any conflict of interest, Consolidated said in another statement. Quadrio is also managing director of Monarch Gold Mining Co., a company associated with Kiernan, the statement said. 

Territory's partners in a possible bid include Hong Kong- based Noble Group Ltd., Lehman Brothers Holdings Inc. and DCM Decometal International Trading GMBH, the company said yesterday. 

Territory is being advised by Argonaut Ltd. and Lehman Brothers' Australian unit Grange Securities Ltd. Consolidated is being advised by JPMorgan Chase & Co. and Pallinghurst is being advised by Deutsche Bank AG.


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## noirua (30 June 2007)

The Pallinghurst led consortium can probably raise the cash part of their offer to $2,00, as this does work out to what their new partner in the consortium could add. Taking it that they would add 50% to the original cash offer. 

How strong is the bid by Territory? The market appears to see it as a weak option and the Territory share halt continuing does point to a fear of a big plunge in the stock price. Would their shareholders back it?

http://www.territoryiron.com.au

The market cap. of TTY is about $240 million at $1.48.


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## noirua (1 July 2007)

The following news report shows the links with Consolidated Minerals, Gloucester Coal and Felix Resources, in the expected set-up of "Consmin":

http://www.smh.com.au/news/business...gloucester-coal/2007/06/29/1182624170236.html


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## Rimtalay (1 July 2007)

noirua,
It is just wishful thinking. Gilbertson and his mates will be giving nothing to ConsMin for nothing. If they fold in any assets, they will be at a premium.
They'll own 60% and no-one can complain.
Best say NO to Gilbertson and NO to TTY.
Tell them both to up the price.
Read the latest Ryan's Notes and you'll see why.
I have posted part below, this is an industry report, not available to the public.

The battle for Australia’s Consolidated Minerals (CSM) 
has finally broken into the open. After Pallinghurst 
Resources increased its bid for CSM early last week based 
on higher manganese prices, Territory Resources, headed by 
Michael Kiernan, the old CEO of CSM, launched his longawaited 
counterbid. The proposal is valued at A$3.73 per 
share, comprising A$1.50 in cash and 1.5 Territory shares at 
its last closing price of A$1.485. This represents a premium 
of 42.3-50.3% based on the independent valuation of 
Pallinghurst’s proposal. The proposal, however, isn’t a firm 
bid and is subject to the completion of due diligence before 
a formal bid is announced. 

If and when Territory makes its formal bid on July 16, the 
company might forgo the cash component and offer a 
straight share deal for swapping its stock with CSM. 
An investor group that includes the Noble group, DCM 
DECOmetal and Lehman Brothers supports the Territory 
bid. Noble and DECOmetal independently hold approximately 
12% of CSM. More importantly, the two companies 
account for 75% to 80% of CSM’s manganese sales and 
100% of its chrome ore sales. “No one else is in a better position 
to know the value of CSM’s assets,” one analyst opined. 
In addition, Noble already owns about 13% of Territory. 
However, CSM’s board, which has always been a strong 
supporter of Pallinghurst, immediately said that that it did 
not intend to pursue Territory’s proposal because it creates 
significant risk and uncertainty for its shareholders. “The 
proposal requires our shareholders to accept Territory 
Resources scrip at a price which the Board believes does not 
reflect territory’s underlying intrinsic value.” 
CSM's Board also pointed out that an independent expert 
changed its finding after Pallinghurst increased its offer, and 
now considers that, in absence of a superior bid, the share 
scheme is both fair and reasonable. 
A group of shareholders are upset about the CSM’s Board 
apparent unconditional support for Pallinghurst’s bid, and a 
few believe that Territory’s bid is superior. “CSM’s management 
is looking for a way to give Pallinghurst the company,” 
one critic said, “and it certainly doesn’t want to see CSM go 
back to Kiernan. Pallinghurst’s bid basically offered the 
shareholders a little money and a minority (40%) interest in 
a company that the shareholders already own. In the US, 

there would be a shareholder’s suit.” 
However, supporters of Pallinghurst said that its bid 
offered more upside potential for shareholders and a willingness 
of the new owners to invest in the company. Because 
the two sides are so opposed to each other, the battle is 
expected to be long and costly. 
With the company in play, analysts are already speculating 
that a third, larger mining company might make an all cash 
offer. “Both bids are flawed,” one analyst suggested. 
The ball is now in Pallinghurst Resources’ court. Early last 
week, Pallinghurst increased its takeover price for 
Consolidated by A$0.30 per share to A$1.68 and will give 
two shares in the new AX listed company for every five 
CSM shares held. According to Pallinghurst, the new offer is 
valued at A$2.82 per CSM share, representing a 30 ¢ increase 
and a 25.2% premium to the last traded price of CSM prior 
to the announced takeover. 
In the midst of a takeover battle, CSM advised shareholders 
of higher manganese ore prices, but was very conservative 
on the financial implications of the higher prices. The 
Australian miner said that it expects the average price 
received for manganese lump ore for fiscal 2007 to be 
approximately $2.32 per dmtu, f.o.b. (the equivalent average 
c.i.f. price is $3.12). This compared to the previous guidance 
of $2.30. The change reflected “stronger prices for recent 
shipments, resulting in an average price for the second half 
of fiscal 2007 of approximately $2.65 per dmtu, f.o.b., compared 
with the previous guidance of around $2.50 for the 
same period.” 
Kermas, Tata, SinoSteel interested in Mn 
CSM’s Director, Rod Baxter said: “Landed manganese 
prices for lump ore shipments to China between August and 
October have been confirmed in the range of $7.25 to $7.50, 
c.i.f., representing just over double the average price 
received for the second half of fiscal 2007 of $3.35 per mtu 
c.i.f. We are currently in the process of finalizing formal contracts 
for these sales. 
The landed manganese price (c.i.f.) includes insurance, 
agent commissions and freight costs. The equivalent net 
price to the company (f.o.b.) for shipments from August to 
October is expected to be as much as 140% over the average 
received price for the second half of fiscal 2007. The net 
price received by the company, in Australian dollars, will 
depend on freight rates and exchange rate movements.” 
CSM’s management said that while there were positive 
economic factors””the significantly stronger short-term outlook 
for manganese, strong demand and robust price for 
chromite, and the value of CSM’s listed investments have 
increased””there were also negative factors. These include 
that the spot nickel price has fallen 28% since the day of the 
takeover announcement, lower nickel production by CSM, 
significant capital investment will be required to keep manganese 
production up, a stronger Australian dollar and higher 
freight rates. 
As the world’s last and largest independent manganese 
miner with a high-grade deposit, CSM is considered a prize. 
“If you can control the ore, you control manganese,” one 
analyst pointed out. “Privat’s takeover of Ghana Manganese 
changed everything. Now the fully integrated producers are 
on top, with CSM the only plum left.” 
CSM isn’t the only thing Michael Kiernan is interested in. 
His latest company, Territory Resources signed a heads of 
agreement with Wadi Al Rawda Industrial Investments, a 
Dubai-based private primary, and Weatherly International, 
an AIM-registered mining and processing group in southern 
Africa to evaluate the Tamboa manganese deposit in Burkina 
Faso. Wadi has the mineral rights and Weatherly and 
Territory will acquire a 72% interest in the Tambao project 
and carry out a bankable feasibility study. Territory will 
spend $100,000 on the pre-feasibility study, which should be 
completed in four months, and if favorable, Territory and 
Weatherly will fund an additional $350,000 over the next 18 
months for metallurgical testing. The Tamboa deposit could 
contain 19-million mt of ore grading 51.45% Mn. Kiernan 
said Tambao could produce 500,000 mtpy within the next 
three-to-five years. 
A few potential partners, including Tata, SinoSteel, and 
Kermas are actively courting Kalagadi Manganese. As one 
of South Africa’s newest manganese miners, Kalagadi said 
that interested parties would receive confidential information 
that will allow them to submit development proposals by the 
end of July. “Some of the companies are quite aggressive in 
their approaches,” one insider said. “They definitely want a 
piece of the action.” 
In order not to dilute the project, if Kalagadi decides to add 
a partner, it would use the partner’s money to expand the 
project to 3-million mtpy of ore as well as fast track the sintering 
and smelter project (Ryan’s Notes, June 25, p1). 
Kalagadi Manganese is 20% owned by the IDC and 80% by 
Kalahari Resources. However, some investors in Kalahari 
feel the company should do its own IPO and list rather than 
find an outside partner. 
India’s MOIL has officially announced of the first of three 
possible manganese alloy plants (Ryan’s Notes, June 25, p1). 
The three-furnace, 100,000-mtpy plant will be a joint venture 
with SAIL and produce 70,000 mtpy of high-carbon ferromanganese 
and 30,000 mtpy of silicomanganese. The 
smelter will be around Bhilai. 
Felman Production’s suit against Boris Bannai seems to be 
stuck in legal limbo. Bannai’s attorneys received the court’s 
permission to withdraw from the suit claiming that there was 
a breakdown of the attorney-client relationship and more 
importantly Bannai failed to pay any legal bills. Bannai 
maintains he doesn’t have any money, while Felman 
believes that he gets considerable income from a Polish steel 
mill that he controls through his family.


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## ta2693 (1 July 2007)

noirua said:


> The Pallinghurst led consortium can probably raise the cash part of their offer to $2,00, as this does work out to what their new partner in the consortium could add. Taking it that they would add 50% to the original cash offer.
> 
> How strong is the bid by Territory? The market appears to see it as a weak option and the Territory share halt continuing does point to a fear of a big plunge in the stock price. Would their shareholders back it?
> 
> ...




I think they know how much CSM worth at the very beginning, but they are just too greedy. they want to benefit as much as they can at the minimum cost. could you pls tell me why they would probably increase their cash part bid to $2 ?


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## noirua (1 July 2007)

ta2693 said:


> I think they know how much CSM worth at the very beginning, but they are just too greedy. they want to benefit as much as they can at the minimum cost. could you pls tell me why they would probably increase their cash part bid to $2 ?




Hi ta2693 and everyone, Thanks to rimtalay, we can increasingly see the real agenda of the Pallinghurst Consortium. That will be the formation of a large "Consmin" that may go straight into the ASX 100, even if that means having 101 stocks for a while. 
CSM seem to be the major link, and Gloucester Coal, Felix Resources and a few other companies, may add to a large presence in the Hunter Valley.
AMCI also have interests with Aquila Resources that could be added to the pot.
There is also the chance that Western Plains Resources could be a future Consmin interest. Felix Resources ( through 90% owned subsiduary S.A.S.E.) having a share interest and royalties on iron ore production in South Australia.


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## bigtbigt (2 July 2007)

I too have just written to Baxter, and taken a different angle...  i.e.

Dear Mr. Baxter,

Hello from the UK, and a *substantial* UK investor in CNM (CSM).

I guess things are rather stressful with current developments, but hope you will reflect on this - my request for injecting some balanced reason and fairness into the future of CNM. Your professional standing, your wider reputation, and my and other investments in CNM all depend upon it.

I won't delabor here the details and financial considerations of why the deals on the table are a shambles, as you know the *facts* better than anyone else. But even from what is in the public domain I conclude that you really should think again about your outright rejection of the TTY bid. I ask you to look in the mirror, and do whatever really is best for your bosses - the investors. You have it in your power to come out of this the hero, and not the villian...

The world IS watching!


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## questionall_42 (3 July 2007)

Announcement out this morning:



> Territory Resources Limited (ASX:TTY), an independent Australian resources group, advises it has written to the Board of Consolidated Minerals Limited (ASX:CSM) informing them, if access to due diligence is provided, Territory is prepared to consider a $2 per share cash consideration and 1 Territory share per CSM share in an alternative proposal or an all-scrip alternative of 3 Territory shares per CSM share.




So, with TTY at $1.20-$1.30, this values CSM at $3.20-$3.30 for the cash/scrip alternative, or $3.60-$3.90 for the all-scrip alternative.

But TTY still need access to CSM's books; and Mr. Baxter is not going to let that happen.


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## noirua (3 July 2007)

questionall_42 said:


> Announcement out this morning:
> 
> 
> 
> ...




This TTL bid looks very fragile. It's a bit like South Australia bidding to takeover the rest of Australia by offering shares in South Australia.


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## questionall_42 (3 July 2007)

noirua said:


> This TTL bid looks very fragile. It's a bit like South Australia bidding to takeover the rest of Australia by offering shares in South Australia.




Agreed.  But it does create a "real" market baseline for CSM shareholders to get a better bid from Pallinghurst ($3.20 barring any collapse of the TTY sp).  Smart move by Kiernan though as it opportunistic to use TTY scrip for the bid. 

CSM will be sold; this is the war. The next couple of weeks will be interesting.


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## noirua (3 July 2007)

questionall_42 said:


> Agreed.  But it does create a "real" market baseline for CSM shareholders to get a better bid from Pallinghurst ($3.20 barring any collapse of the TTY sp).  Smart move by Kiernan though as it opportunistic to use TTY scrip for the bid.
> 
> CSM will be sold; this is the war. The next couple of weeks will be interesting.





Unfortunately TTY have crashed to $1.10 from $1.48 and that makes their bid worth $3.10. If I were a TTY shareholder I would be as mad as hell about this - an absolute no-goer at this stage.


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## Rimtalay (3 July 2007)

Don't be so sure, the fight has only just begun. I'm getting feedback from hundreds of ConsMIn shareholders on the Vote No and they'd rather have script from TTY and still own ConsMin assets than give the company to Gilbertson for chicken feed.
The battle is just starting.


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## Rimtalay (3 July 2007)

Will Gilbertson pay 50% of Newconsmin profits as dividends. I think not.
No mention in the scheme document. It would be foolish to think that because they paid 50% before that they will pay in the future.
I bet there will be little to no dividends paid to shareholders in the future.
Why not ask Baxter, I'm sure he'll tell you.
rbaxter@consminerals.com.au


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## Sainter (3 July 2007)

They're not paying 50% now anyway, despite that original promise. More kept for Gilbo to play with, assuming he wins control. For me a bid of $2 + 1.5 TTY shares per CSM share is about good enough. Or for Gilbo, $5 per share.


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## noirua (3 July 2007)

Sainter said:


> They're not paying 50% now anyway, despite that original promise. More kept for Gilbo to play with, assuming he wins control. For me a bid of $2 + 1.5 TTY shares per CSM share is about good enough. Or for Gilbo, $5 per share.




Unfortunately the bid is $2 + 1 TTY share. It looks as if this TTY bid has not been thought out very well at all. Worth just $3.05 and looking very shakey indeed.


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## Rimtalay (4 July 2007)

Vote NO for all bids at the current offer price.
ConsMin shareholders are being mislead by everyone.

Nobody is telling the truth, ConsMin would be far better off if the management were replaced and they just got on with doing the job. Unfortunately Baxter and Carter have put themselves in a no win situation and haven't the guts to step away, and say NO to everyone.
Both deals stink, Michael Kiernans is the best as ConsMin shareholders will still have a voice and the current management will go.
As I said nobody it telling the truth, and everything else is covered up.
Ie The scheme documents do not even mention BioHeap http://www.pacificore.com.au/
This is 38% owned by Consolidated Minerals, BioHeap are about to produce copper with China Western Mining using the BioHeap leaching process, could be worth many millions.
There is no mention of the dividend payment method in the scheme documents. The original 50% of profit paid as dividends as set up by Michael Kiernan will go, Nobody realises this, the management have not told shareholders about this.
 I also take issue with Brian Gilbertson's statement  “stronger short-term outlook for manganese-mainly driven by unusual supply disruptions from a number of key producers”. 
 There are many other reasons for the increase in manganese ore demand and pricing, ie. 
a)      Stainless steel 200 series production in China, which uses more manganese and ferro-chrome and less nickel.
b)       Outokumpu, has also launched a duplex stainless product, LDX 2101, it’s a nickel-free s.s. and utilizes a greater percentage of manganese instead of nickel.
c)       Hadfield Steel contains 13%+ manganese. This type of steel requires toughness and wear-resistance for applications in gyratory crushers, jaw crusher plates, rail steel and cutting edges for earth-moving equipment.
d)       China plans to expand its rail system over the next decade.  I note that last year China built 36,000 new railway carriages, and plan to build 66,000p.a. by 2010. Each carriage contains 5-6 tons of s.s. The railway system will need 20,000 km of new track. (  high manganese grade steel)
 This increase in manganese ore pricing could continue for years.


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## questionall_42 (4 July 2007)

noirua said:


> Unfortunately the bid is $2 + 1 TTY share. It looks as if this TTY bid has not been thought out very well at all. Worth just $3.05 and looking very shakey indeed.




I don't think it is a fair criticism to claim that the TTY bid is not thought out well.  Kiernan is behind it and, given the ASX media release today, Noble, DCM DECOmetal and Lehman Brothers are too. Opportunistic maybe, but well timed (in relation to TTY's sp rise and the Pallinghursts protracted bid for CSM).

"Territory Resources Limited (ASX:TTY), an independent Australian resources group, confirms if access to due diligence is provided, Territory is prepared to consider a $2 per share cash consideration and 1 Territory share per CSM share or 3 Territory shares in an alternative proposal.
Territory is also pleased to announce Noble Group and DCM DECOmetal have committed to provide $200 million of acquisition funding comprising $175 million at $1.00 per TTY share together with a $25 million loan.
In addition, global investment bank Lehman Brothers has provided a “highly confident” letter for up to $250 million of bridging funding on commercial terms and subject to due diligence.
Territory has also appointed institutional broker, Euroz Securities Limited, to raise the balance of funding through European and Australian institutions."


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## ta2693 (4 July 2007)

TTY's cap is 195m
CSM's cap is 704m

CSM is more than 3 times bigger than TTY. How come is TTY going to take over CSM?
I think CSM takeover TTY is more likely than vice versa.


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## Rimtalay (5 July 2007)

The problem is, CSM is being run by a pack of half-wits.
The management is in a no win situation.

I've gone on record that I do not support either bid, this is the concensus of all Vote No shareholders. I hope that they both start a bidding war.

Kiernan to view ConsMin accounts
Kevin Andrusiak 
July 05, 2007 
MANGANESE miner Consolidated Minerals has relented and allowed a second bidder to enter its quasi-auction process, opening its accounts to former managing director Michael Kiernan.
The ConsMin board was left with little wriggle room after a Territory Resources-led consortium revealed the funding sources backing its firm offer for ConsMin, which effectively puts a floor price under the scrip-based component of its indicative offer. 
Territory has nine days to complete due diligence and make an offer to shareholders before a July 19 scheme-of-arrangement vote on a rival Pallinghurst Resources-led bid. 
Territory advisers from Deloittes, Clayton Utz and Lehman Brothers (part of its bid team) will roll up to ConsMin today to wade through accounting, taxation and financial documents. 
Mr Kiernan, now chairman at Territory, led ConsMin for eight years before he resigned under pressure from the board. 
He said he wanted two weeks for due-diligence access, but was confident it could be done within the tight time frame. 
"This board has finally buckled under immense pressure from shareholders and institutions," he said. 
"Subject to no serious bombs or landmines in the ConsMin accounts or legal affairs, I'm sure we can meet the July 13 deadline. It's a tall ask, but we will roll up our sleeves and it starts now." 
Territory advisers will get limited access to ConsMin's legal, accounting, taxation and financial advisers before it firms up its offer for the company. Early indications are that the Territory offer (partnered with Hong Kong commodities traders Noble Group, Lehman Brothers and DCM DECOmetal) will pay $2 cash and one Territory Resources share for every ConsMin share held. 
Noble and DCM will each subscribe for 175 million Territory shares at $1 each and provide $50 million in loans. 
Lehman has given Territory a "highly confident" letter to provide $250 million in bridging finance to complete the deal. 
It comes as the Pallinghurst-led consortium, which is offering $1.68 cash for every ConsMin share held plus 40 per cent in a new company which will house the ConsMin business, flies to Africa in the hope of securing another chrome-based asset to lure undecided shareholders before July 19. 
Pallinghurst's offer is being made in conjunction with Investec Bank and US coal miner AMCI. 
ConsMin shareholder Glenn Stedman, who has orchestrated a public campaign against the Pallinghurst bid, said ConsMin management had put itself in a no-win situation. 
"Both deals stink," Mr Stedman said. "Michael Kiernan's is the best as ConsMin shareholders will still have a voice and the current management will go. Some shareholders are talking about a class action against the company and directors. I know that the information of manganese and chrome ore had been withheld from the market for more than six weeks." 
ConsMin shares closed down 2c at $3.07, valuing ConsMin at $699 million.


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## kooka873 (6 July 2007)

I too would be happier with CSM if both Baxter & Carter stepped down and were replaced with quality managers.

As for TTY bid - I have lingering concerns about how robust the TTY share price would be in future if TTY is successful. Whether my fears are well founded or not - I no not.

Again I agree with Rimtalay. Best outcome would be a vote NO for both proposals & for the present management to step aside, would that happen? Well if shareholders make their concerns/desires known anything is possible. 

Focus on what we want guys - not on what we don't want.

Kooka


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## Rimtalay (6 July 2007)

I can see *NO* good reason to accept either bid.
Both bids undervalue ConsMin.
Remember manganese sales for this quarter are at US$7.50/dmtu which will relate into a $200 million profit before tax. Chrome ore is up 100% and should result in FY08 pretax profit of $25 million +. Nickel is now unhedged and if they target 5000-6000 tons for the FY08 it will mean a gross income of AUD$200 million.
Why sell consmin to someone else.
Why not put in good management to the run the show.
At the time of the vote on the 19th July  we need shareholders to stand up and vote *NO* to the pallinghurst deal and a vote of *NO* confidence in the management.


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## noirua (7 July 2007)

I still think that the Pallinghurst Consortium (Pallinghurst, AMCI and Investec) bid for Consolidated Minerals will win out in the end. The basic plan, to eventually form a large mining company, seems to be the best idea by far, providing "The Price is Right".
A bid of $2 cash will come in time, and that will value the bid at $3.22 with CSM at $3.08 a share.

The AMCI coal set-up appears a strong part of the plan to have a diversified mining company. Glennies Creek Mine (85% AMCI) is 12km North of Singleton and the Ashton Mine (55% Felix Resources) - AMCI own 19.2% of Felix - is 14km North West of Singleton. These are two mines in the Hunter Valley that AMCI seem to have forward-plans to bring together in a greater NewConsmin. There are many more examples.


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## Sainter (7 July 2007)

But if that happens we'll be left with the same donkey (Ass, mule, take your pick) running the show and that is not good for shareholders. I'm with Rim that neither deal is acceptable ATM, but really, this thing is a 'steel' (haha) at current prices. Even the conservative Huntley's has an 'accumulate' on them at the current price, with a 'hold' from $3.20-$4.20.  Their research and angle looks uncannily like what Rim and I have been posting, but I can assure you neither of us works there!
Remember, look at the dollar value of CSM. Add 0.1 and there is my previously projected 07/08 PER. Would I pay $3.20 for a stock on a PER of 3.3 and central to the China story? Too right I would, and I have.
Cheers!


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## Icharus (7 July 2007)

Bigger is not always better. 
If Pallinghurst wanted to make a large mining house where all shareholders would benefit from the amalgamation they would do it now. Instead the other assets that are speculated to be folded into the new CSM will be done when pallinghurst has control. You can guarantee that there will be a control premium added to the purchase price which will only further dilute the 40% that current CSM shareholders will have.

Speaking of premiums for control, where is the premium for the pallinghurst bid? Are you seriously suggesting selling your shares at $3.33 a paltry 8.12% above fridays close?.

At $1.19 friday close the TTY bid 3 for 1 values CSM at $3.57 and you haven't lost anything. Control of TTY will then be in the hands of CSM shareholders. You will have new management in the form of MK and an iron ore project that is still undervalued by the market.
Also there is the blue sky of a potential manganese project capable of producing 500 000 tpa and exploration on the francis creek site to double the iron ore project

At least there is enough blue sky and value to maintain $1.19 for TTY and if you wanted out, you get an effective $3.57/ share.

In fact I was first and still are a shareholder in TTY and when MK made a bid for CSM I started to buy some CSM because I believe that in the end a 3 for 1 deal represents good buying. 

However if someone outbids TTY bring it on! A profit is a profit but why sell yourself short on the idea of bigger is better?

BTW Wilson HTM has a buy recommendation on CSM valuing them at $3.80 plus. I believe Andrew Peddler is the analyst.


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## noirua (7 July 2007)

If TTY drops the bid for CSM then the share price may return to $1.48 - that tells the story. Is TTY's effort just a spoiling bid ??????????


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## Rimtalay (7 July 2007)

I agree the bid from TTY is far superior to that of Pallinghurst. But why accept any bid. ConsMin has the potential to do a capital raising and acquisition if necessary, on our terms, not Gilbertsons.
Forget about the bull about AMCI folding in coal assets. Just wishful thinking.
They may sell it to New CSM at premium, we'll only hold 40% of the company and cannot say boo.
*Part of Ryan's Notes - take on the deal*
After Territory Resources increased its original proposal 
for Consolidated Minerals’ (CSM) stock, CSM’s board 
granted Territory limited access to conduct due diligence to 
assist Territory to determine whether it will make a formal 
takeover offer. Access is conditional on due diligence being 
finalized by July 13. However, CSM’s board emphasized 
that Territory has not made an offer and that Pallinghurst’s 
bid, which CSM’s board favors, is due for a vote on July 19. 
CSM’s earlier rejection on Territory’s first request for due 
diligence came under fire by both Territory’s and a few of 
CSM’s shareholders. “CSM’s Directors are merely custodians 
of the company’s assets which places on them a fiduciary 
duty to act in the best interests of all the shareholders," 
Territory’s Chairman, Michael Kiernan, said. "The shareholders 
of CSM should be provided with an opportunity to 
receive a superior alternative proposal to the scheme currently 
before them." 
Territory’s revised offer is A$2 per CSM in cash and one 
Territory share or three Territory shares. According to 
Territory, the new offer has a headline value of A$3.25 per 
share based on Territory’s share price. 
CSM’s directors have questioned the value of Territory’s 
shares, saying that current stock prices don’t reflect the actual 
value of the company. 
Territory also answered CSM’s questions on funding. The 
Noble Group and DCM DECOmetal will provide A$200-
million in acquisition funding comprising A$150-million at 
A$1 per Territory share together with an A$25-million loan. 
In addition, Lehman Brothers has provided a "highly confident" 
letter for up to A$25-million of bridging funding on 
commercial terms and subject to due diligence. Euroz 
Securities has been appointed as Territory’s institutional broker 
to raise the balance of the funding through European and 
Australian institutions. 
The ball is now in Pallinghurst’s court. Most analysts think 
even with CSM’s board backing, it will lose unless it substantially 
increases its bid. "CSM’s current directors are toast 
if Territory buys CSM," one analyst pointed out. "Their fate 
is in the hands of Pallinghurst." 
Finally, Pallinghurst, in a possible move to bolster its bid, 
is the subject of rumors that it wants to take an interest in 
Kalahari Resources, with a Pallinghurst executive saying the 
company has signed a MOU on a major manganese project 
in southern Africa. "It’s either Kalahari or Samancor 
Manganese," another observer suggested. "And, both are 
long shots." 
Meanwhile, Kalagadi Manganese is aiming to decide on 
"preferred" strategic partners (two or possibly three), to 
negotiate with by the end of July 2007 in order to conclude 
a deal with the most appropriate partner. 
In terms of selection criteria, the overarching criteria are 
the anticipated value added that the prospective partners will 
bring to Kalagadi Manganese and its current shareholders, a 
Kalagadi advisor explained. The proposed price to be paid 
for an interest in Kalagadi is important, as it will limit the 

dilution of Kalahari Resources participation in Kalagadi 
Manganese going forward. Remaining criteria includes the 
partner’s ability to facilitate project (debt) financing, operational 
expertise (mining / processing / smelting) which need 
not be manganese specific, securing / committing to product 
offtake, and the level of control that the partner wishes to 
secure. 
A separate IPO for Kalagadi Manganese or Kalahari 
Resources is definitely under investigation, specifically as an 
alternative to sourcing funding from a SEP. 
Japan Oil, Gas & Metals National Corp. will host a tender 
for 11,073.5 mt of standard-grade ferromanganese (73-78% 
Mn) from the Japanese national stockpile on July 20. 
Japanese consumers and producers can bid for the material 
but traders cannot. Japan Oil, Gas & Metals will set up the 
minimum price. In April 2004, Japan Oil, Gas & Metals sold 
15,000 mt of high-carbon ferromanganese. The national 
stockpile contains 32,665 mt of high-carbon ferromanganese 
equivalent of 31.8 days of national consumption.


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## Sainter (7 July 2007)

Icharus said:


> BTW Wilson HTM has a buy recommendation on CSM valuing them at $3.80 plus. I believe Andrew Peddler is the analyst.




Hey, I wonder why this isn't up on the CSM website? All those that reckon the Pallinghurst bid is good (huh?) seem to be on there.


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## kerosam (7 July 2007)

i rather have M Kiernan who knows the in and outs of the coy since he founded the coy. and too uncomfortable for me to let someone else control 60% of a company and take the rest of the shareholders as suckers.


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## kooka873 (7 July 2007)

Is Michael Kiernan still a shareholder in CSM? If so anyone know how much stock he retains?

A pity Michael Kiernan got too greedy with his proposed increase in pay towards the end of this term as MD with CSM. Had he been a little less greedy or waited a while whilst CSM grew in capital value perhaps shareholders would have been more at ease with his desired increased pay AND we wouldn't find ourselves in this situation -  but that's the past.

If CSM really is valued at $3.80+/share by Wilson HTM - then this really does expose current CSM management doesn't it.

Appreciate the continued research & comments in this forum. Certainly helps/ed me make an intelligent & informed decision whilst drastically reducing the amount of time required on research. Again..not much research or intelligence required to know that the Pallinghurst Consortium proposed deal smells most foul.   

This way to the door Mr Baxter - do not pass go, do not collect $200. Good bye.


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## Sainter (9 July 2007)

A graph comparing CSM shareprice and the value of manganese over the past two years or so can be found at 
http://www.usail2.com/consolidated_takeover.htm
Makes interesting viewing and would in itself suggest anything less than $4/share undervalues the company.
Another interesting point is to look closely at the jump in manganese price since  late April and compare that to when CSM _finally _disclosed that the manganese price had gone up, on June 25. Given we're in the middle of a takeover, wouldn't that be considered an important omission by the company? Not in keeping with their fiduciary duties? I would have thought so! These guys should be hanging from the highest tree, given the crime (theft from mum and dad shareholders) they're trying to commit here.


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## Rimtalay (10 July 2007)

Letter to shareholders from Vote NO

CONSOLIDATED MINERALS TAKEOVER VOTE NO
Dear Consolidated Minerals Shareholder,
We write to you as fellow CSM shareholders, concerned that we are being encouraged to sell our shares via the Pallinghurst Scheme of Arrangement at below market price and well below what we feel is their true value. We are actively campaigning against this inadequate proposal which will benefit management and the board, to the detriment of the existing shareholders. As fellow shareholders, we ask for your support by voting NO to the proposal. 
WHY YOU SHOULD VOTE NO TO THE PALLINGHURST SCHEME OF ARRANGEMENT
We strongly believe that the proposal consisting of $1.68cash/share plus 2 ‘new’ shares for 5 existing shares is grossly inadequate and significantly undervalues the company. The price offered is NOT fair and is NOT reasonable. The offer is also confusing. Simply put, Pallinghurst Resources is offering to buy three of every five shares you own for just $2.80, well below their current market price. At the closing price of $3.12, shareholders will lose 0.32c/share on three of every five shares. NewConsMin would need to trade at $3.60 for us to break even. Brian Gilbertson meanwhile would have made $109 million. 
Manganese ore is currently fetching record prices (US$7.40/dmtu CIF China). This is not just a short term increase as management imply. At the recent Manganese Institute Conference in Vienna, they indicated rising long term consumption and prices for high grade manganese ore.  
Management is not working in our best interests. They have been seen by external parties to mislead investors on the implications of manganese pricing, as shown by this quote from a reputable commodity ‘news and prices’ journal: ”In the midst of a takeover battle, CSM advised shareholders of higher manganese ore prices, but was very conservative on the financial implications of the higher prices.”
The bottom line is that manganese prices for the next quarter have increased by 140%.  If CSM achieves those September quarter prices for the whole of FY08, the manganese division will add over $200m in revenue.  Even after tax, the manganese revenue that is ‘locked in’ for the upcoming quarter alone will be similar to if not more than what CSM will earn during the whole 2006/07 financial year (projected A$33.8M). A ‘yes’ vote would see you forfeit 60% or more of that.
CSM has a valuable asset in the largest independent high grade manganese ore deposit close to China. The reputable commodity ‘news and prices’ journal believes that “As the world’s last and largest independent manganese miner with a high-grade deposit, CSM is considered a prize.” Management wants you to give away 60% at a discounted price!
CSM has the only chrome ore deposit in Australia. Chromite prices have increased, and the outlook for this commodity from Chinese stainless steel companies is bullish.
Nickel output should increase substantially in the coming year with the commencement of the mine development drives in the Kambalda Dome and production recently commencing at Widgiemooltha. Management recently highlighted CSM’s “significant nickel growth platform” with “significant upside potential” and is targeting 15,000 tonnes per annum output in the near future (RIU conference presentation, May 9, 2007). 
Further significant, high-grade nickel intersections obtained at the Gillet Prospect, part of CSM’s Widgiemooltha nickel, confirming that Gillet is emerging as a significant new nickel discovery and highlighting the upside to CSM’s nickel exploration portfolio.
Nickel is now unhedged, maximising exposure to the current high spot prices.
CSM owns $213 million (94 cents per CSM share) worth of shares in other ASX-listed companies (based on closing prices as of 9/7/07).  These include JML, VML, BCI, MTH and RDR.  Their market capitalisation has increased by more than the additional 0.30c/share offered by Pallinghurst Resources since the original announcement on the 23/02/07.
An alternative, superior offer by Territory Resources (ASX: TTY) is likely, subject to completion of limited due diligence. This alternative proposal is for $2/share and one TTY share per CSM share (nominally worth $3.20 at closing on 9/7/07), or 3 TTY shares/CSM share (nominally worth $3.60 at closing on 9/7/07), superior to the Pallinghurst offer (nominally worth $2.92 at closing on 9/7/07).
YOUR VOTE IS IMPORTANT   –  IF YOU VOTE “YES” (which we DO NOT recommend), 
1)	We, the current shareholders would lose control of Consolidated Minerals forever (Pallinghurst will own 60%) AND lose money in the process.
2)	We will receive considerably less money for our shares than they are currently worth.
3)	We will forfeit 60% of the immediate and ongoing benefit of record manganese and chrome ore prices and future increased nickel output and revenue.
4)	We immediately forfeit 56 cents/CSM share, being 60% of the 94 cents/share CSM currently owns in other companies.
5)	Going forward you will be further diluted by the NewConsMin strategy which will require the issuing of further shares to fund other purchases.
6)	There is no assurance that the existing 50% payout dividend policy will be maintained.
YOUR VOTE IS IMPORTANT   –   VOTE NO FOR THE FOLLOWING REASONS
1)	Vote NO so we, the current shareholders will retain control of Consolidated Minerals.
2)	 Vote NO so we will receive all of the markedly increased profits currently coming CSM’s way, where profit after tax in the coming quarter alone is set to comfortably surpass the entire 06/07 annual profit.
3)	Vote NO, so we will retain 100% of the immediate and future benefit of record manganese and chrome ore prices and future increased nickel output and revenue.
4)	Vote NO, so we retain 100% of the shares CSM currently owns in other companies.
5)	Vote NO, so the possibility of a bidding war for CSM between Territory Resources, Pallinghurst and any other interested parties is retained.
6)	Vote NO, so that 50% of profits to be paid as dividends will be maintained.
7)	Vote NO, as the price offered is NOT fair and is NOT reasonable.

CONSMIN MANAGEMENT HAVE WITHHELD MARKET SENSITIVE INFORMATION
We believe that management have taken advantage of shareholders at a time when the share price was low.  ConsMin management have been fumbling along, at best a lacklustre performance with little vision. They have now decided to engage Pallinghurst Resources to replace their own short-sightedness’ and at our expense. Do not accept this!
For more information, including our estimated financial projection for the upcoming quarter and year, please visit our dedicated website, www.usail2.com/consolidated_takeover.htm

Yours Sincerely

Glenn Stedman  &  Dr Keith Barnard
Consolidated Minerals Takeover Vote NO
gsmarine@yahoo.com kbarnard@iinet.net.au


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## steven1234 (10 July 2007)

kooka873 said:


> A pity Michael Kiernan got too greedy with his proposed increase in pay towards the end of this term as MD with CSM. Had he been a little less greedy or waited a while whilst CSM grew in capital value perhaps shareholders would have been more at ease with his desired increased pay AND we wouldn't find ourselves in this situation -  but that's the past.




You can look at this another way... had CSM paid him the pay increase sought he would have stayed, the company would have been doing well atm (we can speculate it would have done better than what it is doing now led by the current directors), and you wouldn't have to replace the current directors!

I think he has now showed why he deserved the increase.


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## Rimtalay (11 July 2007)

War of words over ConsMin bid heats up
http://www.theaustralian.news.com.au/story/0,20867,22051356-5005200,00.html
July 10, 2007 

HAS anyone else got a copy of the letter addressed to Consolidated Minerals shareholders from those responsible for the Takeover Vote No campaign?
It makes for very interesting reading and the two shareholders who penned the letter, Glenn Stedman and Dr Keith Barnard, lay out why they believe rejecting a Pallinghurst-led bid for 60 per cent of the company is in the best interest of the company. 

The letter, which has just started to appear on trading chat rooms, suggests that shareholders will be the losers should the Pallinghurst bid gets up. 

Now everyone would be aware that Michael Kiernan, through Territory Resources, has been granted limited access to the ConsMin books for a possible rival bid to that of Pallinghurst's. 

Expect Kiernan and co. to come up with a bid in the lead-up to the July 19 shareholder vote on the Pallinghurst scheme of arrangement. 

But the way it looks to the untrained eye at the moment, neither Pallinghurst will get the required 75 per cent approval and Territory will also fall short of the 90 per cent acceptance rate it will probably ask for. 

So where does that leave shareholders and the ConsMin board which has so publicly backed the Pallinghurst arrangement for shareholders to get $1.68 a share in cash and 40 per cent in a new company dubbed NewCSM? 

And this is the nub of where Stedman and Barnard are coming from. 

"We are actively campaigning against this inadequate proposal which will benefit management and the board to the detriment of the existing shareholders," they wrote. 

"The proposal ... is grossly inadequate and significantly undervalues the company. The offer is also confusing."

Daily Assay is not sure about just how the ConsMin board will view the letter, especially the parts which argue that the board played down aspects of the global price rise for manganese, ConsMin's chief output. 

"At the recent Manganese Institute Conference in Vienna, they indicated rising long-term consumption and prices for high-grade manganese ore," the pair wrote. 

"CSM has a valuable asset in the largest independent high-grade manganese ore deposit close to China. Management wants you to give away 60 per cent at a discounted price."

The dissenting shareholders also argue that ConsMin owns a portfolio of interests in other mining-related stocks which is worth $213 million, or about 94 cents per ConsMin share. 

"An alternative, superior offer by Territory Resources is likely. We believe that management has taken advantage of shareholders ata time when the share price was low. ConsMin management has been fumbling along, at best a lacklustre performance with little vision. 

"They have now decided to engage Pallinghurst Resources to replace their own short-sightedness and at our expense.

"Do not accept this!"

Pretty strong words indeed and the basis for a mounting campaign against Pallinghurst which also includes a Vote No website. 

But don't expect Pallinghurst to lie down. 

It has already lifted the cash component of its bid once, partly because of the rising manganese prices and partly because of shareholder dissent, but expect them to throw in another sweetener sometime soon.


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## noirua (12 July 2007)

I still think that this TTY bid is very wobbly. It is the stock of Territory that pays no dividend and whose market capitalization puts it down as a mining minnow, that is the weak point. It really needs an all cash bid or dare I say it, a mix of cash and newconsmin shares, but then the bid would need investment backers on some stance.


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## kooka873 (12 July 2007)

FROM: Steven1234

You can look at this another way... had CSM paid him the pay increase sought he would have stayed, the company would have been doing well atm (we can speculate it would have done better than what it is doing now led by the current directors), and you wouldn't have to replace the current directors!

I think he has now showed why he deserved the increase.

Hi Steven,

There's no doubting the abilities of Michael & I personally was very disappointed to see him leave CSM - even more so at seeing the results of the current board of management of CSM.....and at what they've done to CSM...................

Kooka


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## Rimtalay (12 July 2007)

Kiernan tells it like it is

July 12, 2007 

DAILY Assay has said it before and we will say it again: Michael Kiernan is one of the straightest-shooters going around in the resources game at the moment.
The former truckie tells it like it is. 

It makes for a breath of fresh air not just for journalists, but also for shareholders and analysts and anyone else who crosses the Kiernan path. 

Because effectively what all those mentioned above are trying to do is exactly what he himself, as a miner, wants to do. 

That is scratch around in the dirt and try to come up with something of value. 

So it comes as no surprise that Kiernan would put out a letter to his "fellow" Consolidated Minerals shareholders as D Day approaches for his new vehicle, Territory Resources, to lead a consortium to put in a rival bid for ConsMin to that of Pallinghurst's. 

I hope Kiernan paid someone a decent amount to draft the letter, because Daily Assay will give you what would have been his own version. 

What appeared in the letter: "I would like to introduce myself (or re-introduce myself, as the case may be). My name is Michael Kiernan and I am the executive chairman of Territory Resources, an Australian resources group."

What would have appeared in the original draft: "G'day, Kiernan here. Remember me? If you don't, you can call me boss of Territory Resources. "

Letter: "Over eight years, I had the pleasure of serving shareholders as the managing director of Consolidated Minerals. After bringing ConsMin out of administration, I led the team that, together with Hong Kong's Noble Group and Austria's CDM DECOmetal, grew ConsMin into a near $1 billion company."

Original draft: "I hope you haven't forgotten that with my mates, I built what was a bastard of a company into a billion dollar company before the chairman shafted me."

Letter: "Territory has approached the ConsMin board with an alternative proposal to the Pallinghurst offer, which has been recommended by your board. I believe the Territory proposal would be superior to Pallinghurst's offer."

Original draft: "I'm back baby. I've got bigger balls than Pallinghurst and I'm going to give you more bang for your ConsMin buck with my rival offer. "

Letter: "We requested the ConsMin board allow Territory to conduct limited due diligence so that Territory could evaluate whether or not to make an alternative offer. To my surprise, the ConsMin board initially resisted providing Territory with that access. Last Thursday, they reluctantly agreed to provide due diligence access only until this Friday, 13 July."

Original draft: "Did you see how the ConsMin board wouldn't let us do due diligence? I'm sure you have got a good idea of what I want to do with them when I get my company back. They tried to put the squeeze on me by giving me only a short time to do due diligence when I (with the help of shareholders of course) forced them to let me in the door to see just what they've been up to with the accounts since I left. "

Letter: "However what I think isn't important. What is important is which alternative you think will provide you with the greatest value for your ConsMin shares. To make that decision, you need to be able to consider each proposal on its own merits. For that reason, it is imperative that the ConsMin board delays the Scheme Meeting scheduled for 19 July, at which you will be asked to decide on Pallinghurst's offer. "

Original draft: "You all know I'm the man that's going to save you. But if I'm going to lead, you are going to have to back me up. Get a hold of ConsMin and tell them, scratch that, DEMAND TO THEM, that they delay the vote on the Pallinghurst proposal which we all know (insert chuckle sound) has not a hope in hell of getting up."

Letter: "I encourage you to contact the ConsMin board and demand that the Pallinghurst Scheme Meeting be delayed, so that you can have the opportunity to assess which proposal - Territory or Pallinghurst - is superior."

Original draft: "Oi. What are you still doing. Get onto ConsMin, the number is 08 9321 3633 and get up 'em! You want more money, don't ya?"

Letter: "Yours sincerely, Michael Kiernan."

Original draft: "You know you love me, Michael Kiernan."

Just joking Michael.


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## wintermute (12 July 2007)

LOL   I wonder whether he is mates with Wayne Mcrae   nice to have a bit of humour every now and then!

Tony.


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## Rimtalay (13 July 2007)

Territory races the ConsMin clock
Kevin Andrusiak 
July 13, 2007 

TERRITORY Resources chairman Michael Kiernan has again demanded that Consolidated Minerals delay a vote on a Pallinghurst Resources-led bid for the carbon steels miner as he once more accused the ConsMin board of a dirty tricks campaign.
With only hours to go before Territory's bankers and legal hands are shut out of access to ConsMin's accounts as part of a limited due diligence period, Mr Kiernan has set Monday as the deadline for Territory to table a formal offer - expected to value ConsMin around $730 million. 

However, ConsMin shareholders are set to vote on Thursday on Pallinghurst's share-and-scrip offer, which has been actively endorsed by the ConsMin board and values the Perth-based miner at around $665 million. 

Pallinghurst, which is chaired by former BHP Billiton boss Brian Gilbertson, wants 60 per cent of the company, with current shareholders to retain the rest. 

The company would then be renamed NewCSM and have other mining assets rolled into it. 

The Pallinghurst deal has failed to gain much traction with local shareholders, who have rallied against the deal. 

The July 19 vote would give shareholders just three days to weigh up Territory's proposal, should an offer be forthcoming on Monday. "I encourage you to contact the ConsMin board and demand that the Pallinghurst scheme meeting be delayed so that you can have the opportunity to assess which proposal is superior," Mr Kiernan wrote in a letter to ConsMin shareholders. 

He lashed out at the ConsMin board for what he called a deliberate delaying tactic in the due diligence phase by not releasing ConsMin's unaudited management accounts. 

Mr Kiernan, who headed ConsMin for eight years before he was ousted by institutions and powerful board factions, said he expected the accounts to be available just hours before due diligence was scheduled to close. 

"I'm pleased to say that so far we have found no unexploded bombs in the ConsMin accounts or legal standing," he said. 

"But we wait with bated breath for the new accounts which I believed were supposed to be released today (Thursday). 

"It all just adds to the normal demeanour of the board trying to frustrate us. It's an absolute lay-down misere that they are not acting in the best interests of shareholders." 

Mr Kiernan also signalled that Territory would maintain the cash component of its indicative offer at $2.00 a ConsMin share - which also comes with one Territory share - if it posts a formal offer, as expected, on Monday. 

But he added that the alternative scrip component of three Territory shares for every ConsMin share owned might vary. 

A ConsMin spokesman said the unaudited net profit after tax accounts had not been scheduled for release until today and were "within Territory's due diligence period". 

He added that because there was only one firm proposal on the table, any call for a delay from Territory could only be considered if another bid was lodged. 

"Should an offer be presented to ConsMin by Territory, the directors will consider it and act in the best interest of shareholders," he said.


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## noirua (13 July 2007)

This bid by TTY's Mr Michael Kiernan, has a personal look about it. If TTY have big plans to supply the Global Steel sector, why on earth would they want to takeover CSM and destroy the lean and mean image of Territory.

If TTY up the stake, now worth about $3.14, TTY stock will tumble.

No doubt in my mind that the Pallinghurst consortium will eventually equal the $2.00 in cash offered by TTY and this will take it past the Kiernan Territory offer.


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## wintermute (13 July 2007)

I think that the timing of the meeting, and the timing of the quarterly that has just come out are very interesting.... most people would have to have sent their proxy forms in by now (if posting) those who can hand deliver or are faxing, still have time to think about the quarterly report... I haven't fully read it yet, but it looks pretty positive to me (as I expected it to be)... 

Honestly even with the current management doing virtually nothing, the company is going to be making heaps more money, the Palinghurst offer has always been (and is now even more so) IMO a joke, and the fact that the board even entertained it in the first place is to me almost incomprehensible.  

I just hope that enough average shareholders have not been put off by the ream of paper that was presented to them, and have voted no. 

Tony.


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## Rimtalay (13 July 2007)

It is possible that ConsMin management already realise that the pallinghurst deal is dead. Many shareholders have already voted NO, so the writing is on the wall. Baxter may be trying now to push up the share price to stop Michael Kiernans bid. He'll lose his job if TTY get it.
Look at the profit FY07, next year FY08 will be a ripper.
Forget Gilbertson, tell him to go home to the UK or SA, wherever he likes, just don't come here and try and steal our company.


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## wintermute (13 July 2007)

IMO he (and probably the rest of the board) deserve to lose their jobs regardless of any outcome. For them to continually get up and say they have the shareholders interests in mind is incredulous as far as I'm concerned... I bought into CSM last year (not knowing there was a takeover rumour) not because the price was going up, but because I saw massive potential for the company.  I didn't realize what a dud management team they had at the time, but I think that they have made that very clear now!!

How could they virtually get up and say that the company needs Palinghurst in order to survive (I know they haven't but it is IMO implied) when there were so many positive things going for them, many of which were IMO known before the Palinghurst discussions even started... 

I think if the bid is quashed, the next thing should be for the major shareholders to put a motion forward to sack the board!!  Of course they would have to get some decent folks to replace them, but honestly, the company can surely benefit enormously from a change of management. 

I'm one shareholder who is completely disgusted by the boards actions, and arrogant disregard for the shareholders, I think the slap in the face when they said (more or less) that shareholders who bought on rumours deserve what they get was the final straw for me, I lost all respect for them at that point, as I bought completely oblivious to any rumours, which the only comment CSM had was no comment.  They wanted to keep the price low, why would they do that??? 

OK enough of a vent for me... I guess we shall see by the end of next week where to next 


Tony.


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## Rimtalay (13 July 2007)

CSM has the only independent high grade Manganese ore deposit close to China, it will mean $200 million profit FY08.
Chrome ore is overlooked by the market, they sold $55 millionFY 07, it could be $80-90 million FY08 as the price has doubled. RSA Cr2O3 42% ore is now at US$270-280/ton FOB.
Why sell now, I bet that we get a good offer on Monday, but it will still not fully represent the true value of ConsMin.
The management should be sacked, they have not looked after shareholder interests.


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## noirua (14 July 2007)

Rimtalay said:


> It is possible that ConsMin management already realise that the pallinghurst deal is dead. Many shareholders have already voted NO, so the writing is on the wall. Baxter may be trying now to push up the share price to stop Michael Kiernans bid. He'll lose his job if TTY get it.
> Look at the profit FY07, next year FY08 will be a ripper.
> Forget Gilbertson, tell him to go home to the UK or SA, wherever he likes, just don't come here and try and steal our company.




Nothing dead in the Pallinghurst Consortium Bid, imho, and I believe they will win the day with due patience. If TTY win I will eat all my hats. Mr Kiernan is yesterdays man and is just not big enough to beat the more solid and considerably backed Pallinghurst Consortium; One of which, AMCI, could if they so wished take a tilt on their own.

Having seen so many takeovers by foreign companies of Australian outfits, I doubt it matters that much. CSM are no Woodside Petroleum.


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## Sainter (14 July 2007)

From 8/6/07


noirua said:


> Many Aussie Miners are being hit by the strength of the Aussie Dollar against the greenback. It is still my view that an upping of the current offer by 30 to 40 cents should win the day for the threesome.




Looking back through a few posts, it is funny to see this, then see how Noirua appears to stand firmly in the Pallinghurst camp, talking down CSM valuations, TTY stock and MK as the past and not the future. It was a good call, though, at least from the pricing aspect-Pallinghurst upped its bid by 30c/share on 25/6/07. But the market is currently telling us it is still nowhere near enough.

On 9/6/07 I asked


Sainter said:


> Noirua,
> Can you please expand on what you mean by development costs when the main increase in revenue is coming from an increase in the price received for manganese?
> Cheers!




I'm still waiting.... That post of course was based on Rimtalay's excellent research regarding manganese pricing and well before CSM came clean about the small matter of a 140% increase in the price of manganese for the September quarter. That result makes any answer to the above question irrelevant, really. Funnily enough, that announcement came out on the same day the Pallinghurst bid was increased. Go figure! Anyway, that strengthens the value of CSM and puts it on track to earn >$40M NPAT in the next QUARTER ALONE, approaching 50% more than the entire 06/07 NPAT. Pricing assumptions are presented below, and highlight where revenue is coming from. Although it might be a bit too much to expect, if that is maintained for the year, CSM would earn >$170M NPAT, putting it on a projected PER of 4.2 @$3.26. Or 77cps, 50% dividend = 38 cps. So on that basis, how does anyone come up with a $1.48 valuation as below, unless it is just scaremongering?

ON 7/7/07


noirua said:


> If TTY drops the bid for CSM then the share price may return to $1.48 - that tells the story. Is TTY's effort just a spoiling bid ??????????




I would welcome a 'sum of parts' approach to justify such a call. I'll start it off-there are those pesky holdings CSM has in other ASX listed companies which were worth 95 cents per CSM share at close on 13/7/07....

A clip in the AFR today also mentioned 'continued talk of another party playing a significant role in the eventual outcome'. None of this adds up to a sub $3 shareprice in my book, let alone sub $2.

Roll on Monday.
Cheers!

Price assumptions for 07/08: 
AUS/US 0.855
Mn 1,000,000 t @US$7.25 CIF = 6.25 FOB per dmtu, costs A$2.4/dmtu, to give $236M nett income
Cr 250,000t @US$250/t FOB, costs A$135/t to give $39M nett income.
Ni 5000t @US$35000/t, costs A$8/t, BHP processing fee 35% + sundry, to give $70M nett income.
Admin, finance and selling costs of $96M.


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## Rimtalay (14 July 2007)

noiura, as I said the Pallinghurst bid is now dead, stone cold dead at the price offered. Obviously if Gilbertson wants to raise the price to $2.50/share plus 2 for 5 share deal, he may get it. 
I am  privy to many of the larger shareholders intentions as I emailed 100 large holders and posted letters to 300 of the largest holders, and many have responded and told me that they have voted no. These are people with a large stake, and I mean large. These people are not fools,  you don't own $1 million in CSM if you're a fool.
So if Gilbertson or Kiernan want CSM they will have to pay the right price and at Gilbo's offer of $1.68/share ( +2 for 5) it is only for idiots.


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## Rimtalay (16 July 2007)

*'ConsMin's minions twigging * The Australia 

BRIAN Gilbertson is a smart man. At Billiton, he got the better of BHP. Now at Pallinghurst, he's almost got the better of Consolidated Minerals. Almost. 

In hand with AMCIf's Connecticut coal baron Hans Mende and South African merchant bank Investec, Gilbertson is offering $2.80 a share for ConsMin. And he's got a board recommendation from ConsMin chairman John Carter. The rub is that ConsMin is worth north of $4 a share and shareholders are twigging to the fact that Pallinghurst's bid is too tricky and too low. 

Argo's Rob Patterson and Noble Group's Richard Elman are unlikely to sell. And yesterday, two private ConsMin holders - Glenn Stedman and Keith Barnard - stepped up their "Vote No" campaign, mailing out a note to shareholders. 

"Even after tax, the manganese revenue that is locked in for the forthcoming quarter alone will be similar to, if not more than, what CSM will earn during the whole 2006-07 financial year ($33.8 million)," warn Stedman and Barnard. "A 'yes' vote would see you forfeit 60 per cent or more of that." 

The dissidents are spot on. Pallinghurst is stumping up just 30c a share for ConsMin's stakes in a swag of developers too: Jabiru, Vital Metals, BC Iron, Mithril Resources and Reed Resources, although they're worth $213 million, or 94c a share. 

*Expert's uncovered glory *

PWC hasn't exactly covered itself in glory either. The independent expert has valued ConsMin at $2.70 a share (range $2.40 to $3). Only a year ago, as expert to ConsMin's Titan acquisition, PWC had priced its client at $2.55 a share (range $2.32 to $2.77). 

But in that past year, manganese had shot up from $US2 a pound to $US6.40, chrome ore from $US130 a tonne to $US270 a tonne and nickel from $US7 a pound to $US16. Not only have metals prices more than doubled but ConsMin has enjoyed exploration success, production upgrades and massive price rises as the value of its minority holdings has tripled. 

If a Qantas board recommendation was not enough for the Airline Partners Australia private equity consortium, Pallinghurst can hardly bank on an imprimatur from ConsMin directors. Especially while ConsMin founder Michael Kiernan is pitching a higher bid, some $3.60 a share in cash and scrip, from his new plaything Territory Resources. Kiernan was forced out of ConsMin a year ago. 

Then there's continuous disclosure. Despite much urging from shareholders, ConsMin was tardy telling the market about the big run-up in manganese prices. Shareholders who sold out at $2.65 a share a few weeks ago have cause to be cross. '


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## Sainter (16 July 2007)

CSM has just put out a "our future looks very promising" announcement. I concur, but WHY has it taken an expected bid from TTY for management to announce this? This was known by myself and others two months ago, when only the (lower) Pallinghurst bid was on the table. Why didn't they put out the same sort of announcement then?


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## wintermute (16 July 2007)

Yes and note how the increase in metals prices has nothing to do with this success according to the CSM management! It is all through their initiatives... what a load of hogwash I say  

If you look at previous announcements I'm sure that the last 1/4 they have been getting significantly higher prices for manganese than what they were for the first half year.  They are quoting the average manganese price over the entire year, not what it was and what has been lately... making out that they have had NO benefit from increasing manganese prices at this point.... I could have sworn they posted that they were getting a benefit from increased manganese prices before (though they never told us what the prices were, even though in the yearly report last year they stated they would give regular updates on the prices being received....) 

They must think that the average shareholder is an idiot!!!

Tony.


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## kooka873 (16 July 2007)

Hi Rimtalay,

Yes enjoyed your tongue-in-cheek post about Michael of July 12th re his trucking background. Having been a CSM holder for over 5 years I knew of this background.

I too gathered that Michael was a straight shooter & my support for him has nothing to do with the fact that my father was in the trucking industry also.
Another successful trucker was Lindsay Fox - no nonsense, direct & knows where he wants to go & what what he wants to do - 'driven with a passion' similar to Michael. Look at the growth of Lindfox. Pity there's no vision, drive & passion to be found in current CSM management - only .....well that's been covered before.

Still no word out at 5.55pm AEST from Territory Resources - perhaps something within the next couple of hours about the next offer. Dividend record date tomorrow.

Appreciated reading Wintermute's messages too - plenty of fire-in-the-belly by CSM shareholders as there should be right now. Noirua's welcome comments have added balance to this forum also. 

We're in for an interesting week - buckle up for the ride, there could be many routes taken or offered on this journey.

Regards

Kooka


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## Rimtalay (16 July 2007)

*ConsMin suitor hits out at rival*Kevin Andrusiak | July 16, 2007 
PALLINGHURST chairman Brian Gilbertson has launching a stinging attack on the ethics of his rival in the fight for Consolidated Minerals, Territory Resources' Michael Kiernan, saying his bid amounted to "putting the foxes in charge of the chicken coop".

Although he was content to sit on the sidelines as Mr Kiernan and his financiers prepared Territory's offer for ConsMin - which relies on funding from Noble (ConsMin's biggest customer for manganese), DCM and US bankers Lehman Brothers - the hard-nosed South African businessman yesterday said Territory's plans to reconfigure its own board if its bid was successful created "potential for significant conflicts of interest" and made a "mockery" of board independence. 

The ConsMin board has backed Pallinghurst's offer of $1.68 cash for each ConsMin share and two shares for every five held in a new company to house the ConsMin business. 

Pallinghurst is on the verge of unveiling the acquisition of a South African chromite mine. It is also believed to have signed a Memorandum of Understanding to acquire an Australian coking coal asset. 

"Noble is an intimate participant in the price-setting process for ConsMin's manganese," Mr Gilbertson said. "The interests of an agent in his marketing fees and commissions and in the associated logistics contracts are not well aligned with the interests of the principal." 

Mr Gilbertson also questioned the intentions of Mr Kiernan and Noble's Richard Elman - who was also a board member of ConsMin during Mr Kiernan's eight year tenure with the company - as to why they sold ConsMin shares in September and October 2005 as the company negotiated lower-priced manganese contracts and just after they had backed a $40 million share placement. 

Mr Kiernan announced his intention to resign just seven days before ConsMin unveiled the softer pricing outlook. 

He also claimed that Bank Austria Creditanstalt, the preferred institution of DCM, could be in breach of the Corporations Act - if rumours that it bought 500,000 ConsMin shares prior to a June 25 ConsMin announcement that manganese prices had firmed were true. 

ConsMin agents have sought to "out" the mystery buyer of the shares, but to no avail. 

Mr Gilbertson also pointed out that Noble was rumoured to have been behind a purchase of 1.7 million ConsMin shares in the weeks leading up to the June manganese pricing outlook. 

"Flawed corporate governance is a poor foundation on which to build a great company," Mr Gilbertson said. 

Territory will go into a trading halt this morning before it announces its cash/scrip bid for ConsMin, likely to be around $2 cash and possibly 1.5 Territory shares. An alternative all-scrip component of 3.3 Territory shares is also on the cards. 

Mr Kiernan also lashed out at Mr Gilbertson. 

"I'm surprised Brian Gilbertson has descended into the sewer to make these grubby comments," Mr Kiernan said. 

"This is the man who wanted me to be managing director or chairman of NewCSM, but I rejected the idea." 

Neither Noble nor DCM could not be contacted for comment. 

Mr Kiernan said no one had complained previously, when Mr Elman was a ConsMin board member. He said Territory would install up to four independent directors if its ConsMin bid was successful. 

Meanwhile, ConsMin has also hit out at Mr Kiernan's claims that the miner had performed below shareholder expectations despite it posting a big turnaround in full-year profit to $31 million for 2006-07, in unaudited accounts. 

Managing director Rod Baxter said: "When I started as managing director in July 2006 (taking over from Mr Kiernan) the company was in poor shape. 

"Shareholders had lost confidence and the company's reputation in the marketplace was not good."


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## Sainter (16 July 2007)

Ann out late today-TTY is putting in an offer tomorrow. Will be interesting to see how it stacks up, given the jump in CSM today.


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## Aedo (17 July 2007)

TTY Announcement out http://www.asx.com.au/asxpdf/20070717/pdf/313gx03gk5n3k1.pdf.

$2 cash plus 1.5 TTY shares


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## Rimtalay (17 July 2007)

Territory makes its move  - MINING NEWS

Kate Haycock
Tuesday, 17 July 2007

AFTER a tense wait yesterday Michael Kiernan's Territory Resources has made its $966 million counter-bid for Consolidated Minerals, prompting ConsMin to postpone its shareholder meeting to decide the fate of the original Pallinghurst group offer.


Territory's official offer is for $2 cash and 1.5 Territory shares for each ConsMin share, which values the company at $966 million on a fully-diluted basis, based on Territory's current $1.10 share price.

The company's previous cash and scrip proposal for ConsMin was for $2 in cash, plus one Territory share.

The offer also represents a 32% premium to the high case valuation of ConsMin by PricewaterhouseCoopers, Territory said in its official bid today.

ConsMin is already the subject of a private equity takeover play led by Brian Gilbertson's Pallinghurst Group, worth $1.68 per ConsMin share, plus two shares in the "new ConsMin" for every five shares currently held. 

Market observers have indicated the Pallinghurst bid is worth around $700-800 million.

Territory also confirmed today that the funding for the play will come from the company's major backers, Noble Group and DCM DecoMetal, which market much of ConsMin's manganese and chrome production and together hold around 12% of ConsMin's issued shares. 

The two companies have given equity commitments to provide $150 million and $25 million respectively in an equity placement worth $1 per Territory share.

Further funding will come from US investment bank Lehman Brothers, which will provide an additional $320 million credit facility on commercial terms to fund the offer, some $70 million more than the $250 million credit offer Territory originally flagged.

In a market announcement this morning following Territory's offer, ConsMin said it would seek a 28-day adjournment to the scheme meeting on the Pallinghurst bid, and would confirm the new shareholder meeting dates once the court orders are received. The meeting was to be held this Thursday. 

The board is considering the Territory proposal and will provide guidance to shareholders shortly, ConsMin said.

Shares in ConsMin fell 2c to $3.43 while Territory's shares were up 3.5c to $1.135 after it came out of its trading halt to make the takeover play this morning.


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## Rimtalay (17 July 2007)

*Consolidated bid battle marks miners out as a hot commodity *
By Nic Clark 
Published: 16 July 2007 


Consolidated Minerals, the focus of a bidding war between rival Australian mining barons, has resurrected its fortunes in 2007. The group, which listed on the Alternative Investment Marker four years ago, posted net profits of $31m for the 12 months to the end of June 2007, reversing losses of $6.5m the previous year.

The management team can take huge credit for overhauling a strategy that was not working. It cut costs in its manganese division, diversified into nickel and expanded out of Australia. Coupled with the strength of commodity prices this year, Consolidated Mining's share price has almost doubled in eight months.

Success brought the inevitable takeover interest, which seems to have become a clash of egos between Brian Gilbertson, of Pallinghurst Investor, and Michael Kiernan, of Territory Resources.

Mr Gilbertson put out a joint statement with Consolidated in February outlining the benefits of a tie-up and will today up his takeover bid from $1.38 per share to $1.68. Consolidated's former chief executive Mr Kiernan asked shareholders to delay their votes on Pallinghurst's offer until he had finalised his own later this week.

The industry will watch with interest as the battle intensifies, although the board is expected to oppose Mr Kiernan, despite a higher prospective offer, as he intends to oust the current management.

Phil Swinton, an analyst at Hanson Westhouse, said that whatever the result, prospects looked "very good" for Consolidated. "They are making the right moves, and operationally they should improve further," he added.


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## Rimtalay (17 July 2007)

*Kiernan talks up ConsMin plans* 

Kate Haycock
Tuesday, 17 July 2007

TERRITORY Resources boss Michael Kiernan was the picture of confidence today after his company made its eleventh hour bid for Consolidated Minerals, claiming the play had shareholder support and detailing his plans for the future of ConsMin post acquisition.


In a conference call this afternoon, Kiernan said that Territory's bid for ConsMin, worth some $966 million fully diluted, was a fair offer for the manganese miner.

"I've been saying that under any stretch of the imagination our offer would be superior to the current scheme," he said. 

According to Kiernan, the Territory scheme is worth around $3.70 per ConsMin share while the competing Brian Gilbertson-led Pallinghurst Resources private equity offer is worth around $2.90. 

Kiernan also said the acquisition would give Territory shareholders a fair return and rejected charges that the offer of $2 cash and 1.5 Terrtory shares for every ConsMin share was too high.

"Our bid is not overpriced, the Pallinghurst bid was seriously underwhelming," he said. 

Kiernan also confirmed that Territory would be selling ConsMin's nickel assets if the takeover was successful. However, he said this did not indicate the initial decision to take on these assets, taken while he was the managing director at Consmin, was an error.

"Underground mining is a very different psyche, and any underground operation – which is the nickel and also the investment in Jabiru – will be divested so Territory Resources can focus on being an open pit miner," he said. 

"I've simply made a strategic decision that Territory does not want to be an underground miner."

Kiernan went so far as to call ConsMin's nickel interests, including Widgiemooltha and ConsMin's strategic stake in Jabiru Metals, "wonderful assets", and said that the company would pursue an aggressive exploration and development program of the company's wholly-owned assets before opening them up for sale.

"I made it no secret that, somewhere between six to twelve months, would be when the nickel would probably be on the market. It's going to require six months at least of kicking ass and shaking trees," he said. 

Kiernan also said that his financial backer, US investment bank Lehman Brothers, was "very relaxed" about the $320 million credit facility.

After divesting the nickel, which would be worth between $250-350 million, he predicted Territory would have a healthy balance sheet. 

"Our proposal, going forward, is that Territory would have very little debt once everything settles down and would have some $200 million of cash in the treasury to go and be worrywarts somewhere else with." 

Kiernan also said there were already signs of shareholder support for the Territory bid, saying he had confirmed about 20% of ConsMin shareholders supported the company's offer.

"From our point of view, we've considered that the board has been an irrelevance for some time, and we've pitched our correspondence at the shareholders at ConsMin," he said. 

"I think the shareholders are very pleased that they've got an alternative offer."

The new structure of the company post-acquisition and after divesting the nickel assets would see several subsidiaries operating Terrtory's various iron ore projects, as well as a Pilbara Manganese operation and a chromite subsidiary out of ConsMin's assets. 

Kiernan also said he was not interested in "bidding wars" and would not comment on whether he would be willing to raise his offer for the company should Pallinghurst come in with another offer. 

However, he made it clear that he didn't believe the Pallinghurst offer would appeal to ConsMin shareholders, and again referenced his history with ConsMin. 

"Brian [Gilbertson] said that it was like putting the foxes in charge of the chicken coop – well us foxes built the chicken coop," he said. 

"And in our days it was a bullring – it's only now that it's been stuffed with chooks."

Kiernan also flagged more acquisitions for Territory should the acquisition of ConsMin go ahead to create a "balanced portfolio of broad-based commodity supply". 

Shares in Terrtory ended the day down 3.5c to $1.065, while ConsMin shed 10c to $3.35.


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## Rimtalay (18 July 2007)

Macquarie: CSM - The Game Has Just Begun
18/07/2007

Territory Resources (TTY) has formally announced an off-market takeover bid 
for Consolidated Minerals (CSM). The offer price consists of $2.00ps cash 
and 1.5 TTY shares for each CSM share, implicitly valuing the bid at 
$3.60ps. Macquarie Research Equities (MRE) believe that CSM is worth 
considerably more following the recent movements in the global manganese 
market. In fact, MRE believe that it is possible that the bid price moves 
closer to $4.00/ share.

Coming over the top. The TTY bid compares with the current 
Pallinghurst/AMCI/Investec offer for CSM of $1.68ps cash plus two shares in 
NewCSM for every five shares in CSM. At the CSM closing price yesterday of 
$3.35ps, the Pallinghurst bid implies a value of $3.02ps.

Booming manganese. Record manganese ore price levels were recently confirmed 
for sales to China between August and October. Landed prices range between 
US$7.25-7.50/dmtu CIF, representing more than double the average price 
received for 2H07 (US$3.50/dmtu CIF). We have upgraded our FY08 and FY09 
received manganese price assumptions (by c90% in the case of FY08).

FY07 result. CSM announced unaudited FY07 NPAT of $30-31m (pcp $6.5m loss) 
with its June quarter production report. This was broadly in line with our 
forecast of $33.8m after accounting for higher corporates (associated with 
the Pallinghurst transactional work) and Jabiru equity accounted losses.

Macquarie Research Equities Recommendation
MRE maintain outperform recommendation on CSM and price target upgraded to 
$3.80ps.

In an environment of mining equities typically trading at premiums (many 
significant) to their fundamentally derived DCF value, and at much higher 
short-term earnings multiples, CSM continues to look pretty attractive.

Given the recent movements in the global manganese market, CSM is now worth 
considerably more than it was several months ago. In our opinion, both 
bidding parties will need to, and are probably capable of, paying closer to 
$4.00ps (in risk-weighted value terms).

Traders looking for maximum exposure to short-term movements in the above 
mentioned share prices should consider the following equity warrants for a 
high-risk, high-return strategy.

Investors and traders looking for short to medium-term leveraged exposure to 
the banks’ share price should consider Macquarie Instalments for a higher 
risk, higher return alternative to direct share investment.


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## kerosam (18 July 2007)

guys, anyone had a look at the technical indicators? traders bullish on this one? i wanted to try it on Protrader. as its just a 'try out' disc, i only have info till 7th July.


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## Rimtalay (19 July 2007)

Gilbertson spits the dummy. Not happy that the scheme meeting has been delayed. 

*Gilbertson flies in for a glass of whine*
 Jamie Freed
July 19, 2007

*
Wasted trip ... Brian Gilbertson.*

 A meeting to approve BHP's merger with Billiton six years ago, Brian Gilbertson was famously deemed the "faceless man" by an outraged investor.

The slur may have been justifiable, given the architect of the biggest mining deal in history didn't even bother to show up.

Six years on, with a bid for Perth miner Consolidated Minerals on the table, Mr Gilbertson was eager to prove to the Australian market that he'd changed.

So, understandably, the legendary mining boss wasn't in one of his better moods when he landed in Perth yesterday afternoon, jet-lagged and tired, only to be told his journey from London was unnecessary.

While he was in the air, ConsMin received court approval to delay a scheme meeting originally scheduled for today. The company's board wanted time to consider a rival offer from Territory Resources, a junior iron ore miner led by former ConsMin managing director Michael Kiernan.

At the meeting, now postponed until August 16, the Perth miner's shareholders will decide whether to accept a partial takeover offer by Mr Gilbertson's private equity group, Pallinghurst Resources. In the meantime, the man one former associate deemed a "grandstander" is threatening to withdraw his offer altogether.

"I came across for the scheme meeting only to find there was no scheme meeting," Mr Gilbertson said. "I made it clear that I did not wish it to be postponed."

He said Territory's rival offer, which includes a higher cash component than the Pallinghurst bid, was "clearly inferior".

He noted his advisers had told him it was one of the most conditional offers they had ever seen. For the record, it contains 17 conditions.

Mr Gilbertson's frustration was all the more palpable because Pallinghurst has spent months amassing projects for a revitalised ConsMin under its control.

Pressed for details, Mr Gilbertson said he had "no intention whatsoever about telling anyone about those now". He said Pallinghurst was promised a $5 million break fee if the ConsMin board recommended a rival offer. For its part, ConsMin says its board had no choice but to postpone the meeting.

As for Mr Gilbertson, it looks like he's trying to make the best of his unnecessary trip to Australia. "Right now I'm going to go out to a restaurant and have a nice glass of red wine," he said.


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## Aedo (20 July 2007)

Pallinghurst ups offer - $3.30 all cash.   Subject to minimum 50.1% acceptance (among other conditions)
http://www.asx.com.au/asxpdf/20070720/pdf/313jgv4bhlw02m.pdf


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## ta2693 (20 July 2007)

When the war starts, if the both sides are equal in strength, the war will keep on for a long time. 
If one side is overwhelming powful, the war will end very soon.

The bidding war on CSM is on. One side is TTY + LB + Noble group.
The other side is pallinghust + JP Morgan.
I am wondering are both sides equal in strength? 

I think the answer is yes, I will hold and expect TTY to have another bid.


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## questionall_42 (20 July 2007)

ta2693 said:


> When the war starts, if the both sides are equal in strength, the war will keep on for a long time.
> If one side is overwhelming powful, the war will end very soon.
> 
> The bidding war on CSM is on. One side is TTY + LB + Noble group.
> ...




And you could add, to the other side (highlighted in bold) current CSM management.  They have done little to accommodate the TTY bid and all to accommodate the Pallinghurst bid(s).  

I have a small holding and will look forward to seeing how this progresses.  Two big egos; one little company...


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## kerosam (20 July 2007)

so tempted to open a CFD account and LONG this baby.:

for those who believe the fundamentals of this coy, what is considered a good offer besides price? prospects in overseas perhaps?


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## kerosam (20 July 2007)

if the two D***h***s remain in the company, we are still back in square one... a useless bunch of managment. on the brighter side, we can at least see the true colors of baxter & carter.



> Pallinghurst launches fresh ConsMins bid (from SMH.com.au)
> July 20, 2007 - 9:40AM
> 
> The board of takeover target Consolidated Minerals is now recommending a new $3.30 cash offer from the Pallinghurst consortium.
> ...


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## Rimtalay (20 July 2007)

Hi Kerosam,
The pallinghurst offer might keep the same chooks in the henhouse, but don't worry the rooster ( Gilbertson) will be crowing early in the morning, and will be pecking those lazy , good for nothing chooks off their backsides to make him a quid.
Gilbertson, already realises that CSM board are  a pack of dimwits. They are so stupid they forgot to phone him and tell him that the meeting on the 19th July was postponed.
I reckon a vote for Gilbertson, is now better than the TTY bid. At least we can choose if we wish to sell our shares at $3.30.
We get to keep the nickel assets and JML, not to be sold off like  MK
I reckon that Rod Baxter should show some leadership and excise his 1 million options and give 600,000 to Gilbo for $3.30/share. He'll get to keep 400,000 shares and will have $40,000 change in his pocket and not spend one dollar.
email Baxter and tell him to show us some leadership    rbaxter@consminerals.com.au


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## Rimtalay (24 July 2007)

*Kiernan won't let up on ConsMin*

Andrew Trounson, Takeovers | July 24, 2007 

*MICHAEL Kiernan's Territory Resources will decide by the end of the week whether to make an alternative all-cash offer for Perth-based manganese miner Consolidated Minerals.*

Speaking yesterday to The Australian from India, Mr Kiernan said an all-cash alternative offer to Territory's current cash and scrip bid was possible, as he tries to see off a rival $3.30 a share all-cash bid from Brian Gilbertson's private equity resources fund Pallinghurst. 

"We could give a cash alternative. It is certainly being canvassed at the moment," Mr Kiernan said. 

Such an offer would be made concurrently with the existing combined scrip and cash offer, he said. 

Mr Kiernan is in India on business for listed explorer India Resources, of which he is executive chairman. 

But he plans to return to Australia later in the week, when Territory will review its options. 

Under pressure from the Territory bid, Pallinghurst was forced last week to make an all-cash offer for ConsMin, dumping its already improved previous offer of $1.68 a share plus two shares in a new ConsMin for every five held. 

That offer was was aimed at securing 60 per cent control of the target. 

The new all-cash bid, which is conditional on Pallinghurst securing 50.1 per cent of ConsMin, has been backed by the ConsMin board. 

The board has supported Pallinghurst throughout the takeover battle, much to the chagrin of Territory and a group of ConsMin shareholders concerned that Pallinghurst's original offer was too cheap. 

While Territory's offer of $2 cash plus 1.5 Territory shares currently values ConsMin shares at $3.68, the ConsMin board doubts the value of Territory scrip and is concerned at the debt Territory is taking on to fund its bid. 

Pallinghurst is also trying to tempt ConsMin shareholders with Mr Gilbertson's undoubted -- but to date intangible -- deal-making skills. 

Pallinghurst is believed to have signed a memorandum of understanding over a South African chrome asset and a coking-coal asset, which it plans to add to ConsMin if it wins control. 

Mr Gilbertson is a former CEO of resources giant BHP Billiton, and is credited with building South Africa-based Billiton into a resources major. 

ConsMin shares yesterday continued to hold a premium to Pallinghurst's bid, but fell 4c to $3.42, valuing the company at $779 million. 

Territory shares fell 2c to $1.125. 

Territory is being backed by Hong Kong commodity trading group Noble, Austrian trading house DCM DECOmetal and US bankers Lehman Brothers. 

In Pallinghurt's corner is US trading group AMCI, South Korean steel giant Posco and US investment group NGP Midstream & Resources.


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## Rimtalay (24 July 2007)

A MEMO to Territory Resources.

*TO: Territory Resources. *
From: Daily Assay. 
Subject: *Press Speculation concerns*. 
Date: July 24. 


*Dear Territory,*

I note with concern your concern about the press speculating as to whether Territory will change the details of its takeover bid for Consolidated Minerals. 

You're concerned, we're concerned - everybody's concerned. And now it looks like the Australian Securities Exchange is concerned. 

Firstly, Daily Assay hasn't seen what all the other journos around the nation have written in regards to a possible improved offer from Territory, but the stuff we have seen is pretty much in line with what The Weekend Australian reported on Saturday. 

That being Territory is going to review its bid in the wake of a Pallinghurst improved offer for ConsMin which lobbed on Friday. 

As part that review, Territory is possibly looking at throwing more cash into the mix of its cash/scrip offer which values ConsMin at $966 million. 

"We're going to review our offer. We could go all-cash if we wanted to and it's definitely an alternative," is what The Weekend Australian reported Kiernan as saying. 

That came from a conversation with Kiernan himself. On Friday. 

It's not wrong. The notes speak for themselves. 

Other reports noting that alternative have also surfaced. 

So why did Territory managing director Doug Stewart tell the ASX on Monday, after presumably the ASX raised the issue, that it was the just the press being speculative that Territory was thinking of changing its offer? 

"Territory Resources Limited notes today's press commentary on its takeover bid for Consolidated Minerals Limited and confirms it is merely press speculation," is what Stewart told the ASX. 

Me and my press buddies get blamed for a lot of things. Some of which is right (and which makes us duly embarrassed), while some of the accusations are just dead wrong. 

Also, didn't Territory pay a representative of the company to ring around and touch base with the hacks on Sunday to spruik the line that the company was seriously considering lifting the cash component of its offer? 

Think very carefully about that one. 

The Territory spruiker even went to great lengths to point out that the information was coming from an :industry source" and should be reported as such. 

That's how the Sydney Morning Herald played it on Monday. 

"Industry sources said Territory was 'seriously considering' a sweetened cash component," is what the Herald's resources expert Jamie Freed penned. 

So why is the press being accused of mis-reporting? Did we make it up? 

Or is there something written elsewhere that has led you guys to finger the press for the "speculation"? If so, shouldn't Stewart have made that very clear in the ASX announcement. 

As we have said before, Kiernan is somewhat of a straight-shooter in the resources game and a breath of fresh air for the members of the fourth estate. 

He tells it like it is - or how he perceives it. There can be no doubt about that. 

And it might just be HIS speculation that Territory will increase the cash component of its bid. But he is the chairman after all. 

As noted before, it may be an entirely off-the-mark media report which has got Territory's back up. But that point should have been made clear in the ASX announcement. 

But dumping on the press for reporting Kiernan's - or the spruiker's - comments accurately is not fair. And it is likely to win you few friends either. 

Yours sincerely 
Daily Assay 

email: andrusiakk@theaustralian.com.au


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## wintermute (24 July 2007)

Ok I did some (literally) back of the envelope calculations tonight.  These should be taken with a large grain of salt (and be checked for accuracy. I often make mistakes), but give an idea of what the potential profit of CSM for 2007/2008 fin year could be. 

figures based on increased margins only.  Assumptions… 0.88 us $ / aus dollar (CSM was hedged at .73 but not sure if it still is).  US $30,000/tonne nickel price which is IMO reasonably conservative.

Nickel.  Extra $6822 AU per tonne.  4000 tonnes, additional ~$27 million before tax

Manganese.  Extra $4.72 AU per dmtu FOB (assuming CIF of $1.00/dmtu which is higher than current 86c)  47% on ore purity.  900,000 tonnes…. = additional ~$200 million before tax

Chromite not enough info will assume flat price (though suspect it will be higher). 

So just considering same production costs, and levels, and flat prices for manganese and nikel, CSM should make approx 227 Million additional profit before tax or 158.9 million additional NPAT. For a total of around 190 million NPAT if you add in the 30 million base profit from this year.  Or an *eps of around 83cps*

These calcs are crude, but I used the same method to estimate (though with a little more care) MRE's full year profits, and pretty much nailed it.  The idea is simple... any increase in the commodity price results in pure profit, as the underlying costs have not changed. 

say you produce 1 million tonnes of a commodity that breaks even at $200 / tonne.  if the price increases to $400 / tonne, you suddenly make $200 million profit before tax..  this is basically what is happening with CSM and manganese prices! 

since csm pays out roughly 50% in dividends, that is roughly 40 cps in dividends alone! at a sp of $3.30 the forward p/e would be 3.9....

again, these calcs make assumptions on commodity prices and production costs, and production volumes remaining constant, which are BIG assumptions, but it gives an idea of where CSM is potentially headed... if you then factor in upside potential in the nickel operation it only gets better IMO  

Tony.


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## Rimtalay (25 July 2007)

Hi wintermute,
Your calculations are similar to those on the Vote No website. They have a PE of 3.6 Check it out
http://www.usail2.com/consolidated_revenue_projections.htm
What do you think?


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## wintermute (25 July 2007)

hmmm interesting to see pretty similar figures from my quick and dirty method, with the more complete method used on vote no, gives me a little more confidence that I haven't made any major blunders. 

The biggest assumption IMO is that the US $ rate is .88 as if CSM put in more currency hedging (like they had for 06/07) then the figures could potentially be much better than either of the calcs show.  

I wasn't certain of what price CSM were getting NOW as opposed to the average, for Chromite so decided not to factor that in, could be the main place where the figures differ.  actually I just had a closer look and the nickel on vote no has quite a bit of difference to my calcs, but funnily enough overall, they come out remarkably similar!

Cheers, 

           Tony.


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## Rimtalay (25 July 2007)

*More than just pure speculation *

SEEMS Daily Assay put the cat amongst the pigeons with our memo to Territory Resources over its "press speculation" announcement on Monday.

To refresh your memory, here's what happened: 

Territory chairman Michael Kiernan told The Weekend Australian that the company would review its bid in the wake of an improved Pallinghurst Resources offer for the carbon steels miner they are both chasing - Consolidated Minerals. 

Territory then used a paid-up representative of the company to spread that message to other hacks on the weekend, which was duly reported by some. 

The Australian Securities Exchange got wind of what was going on and promptly asked Territory if it was true: was Territory going to change the details of its offer? 

Territory managing director Doug Stewart informed the ASX, and therefore the sharemarket, that it was merely press speculation. 

What Daily Assay wants to know is what advice did Stewart have in making that statement? Did company lawyers insist that the statement was the right one to make? 

It is worth noting that Kiernan was out of the country and on a business trip to India when the statement was lodged with the ASX. 

Also, are the rumours true that Stewart is no longer managing director of Territory? 

But enough of that for now, Daily Assay's feedback from its readers is that many people are suitably embarrassed by what has gone on. 

Daily Assay also wonders if the ASX is asking further questions on the matter.


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## noirua (26 July 2007)

The mining sector has been in a decline this week with continued concerns about the USA. Maybe the decline will be reversed, if not, we may see the $3.30 cash offer for CSM looking a more solid cash bid. TTY has declined to $1.025 from $1.49 at the time of the counterbid.


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## Rimtalay (27 July 2007)

*ConsMin shares on the up as new Territory offer looms *

Kate Haycock
Friday, 27 July 2007

*SHARES in Consolidated Minerals have risen by as much as 14c this morning in anticipation of another bid from Territory Resources, defying widespread falls across the share market and the mining sector today. *



The price rise came as ConsMin cancelled the proposed scheme meeting with shareholders to consider the original Pallinghurst Group schemes of arrangement in light of the new offer from the Brian Gilbertson-led consortium. 

In a letter to shareholders this morning ConsMin said that after receiving the new offer from Pallinghurst, which replaced the original schemes of arrangement from the private equity group, it had obtained court orders to cancel the August 16 scheme meeting. 

ConsMin's share price has risen almost 9% this week from $3.42 on Monday to an intra-day high of $3.74 this morning, a boost of 14c, before settling slighting to $3.71. 

This morning's price rise came as news reports in The West Australian said Territory Resources was considering making another offer for the manganese miner and could do so as early as Monday.

A spokesperson for the company confirmed to MiningNews.net this morning that Territory, led by ex-ConsMin head Michael Kiernan, was working with its advisers on a revised bid.

The company is reportedly considering an all-cash offer for the manganese miner.

One of ConsMin's main criticisms of the Territory offer is that the scrip component of the bid is uncertain.

ConsMin has also been critical of the conditions of the Territory offer and the debt requirement Territory would bring to the deal. 

The new Pallinghurst offer, which the ConsMin board is backing, is worth $3.30 cash per ConsMin share or $775 million, and is subject to a 50.1% minimum acceptance condition. Pallinghurst is targeting around 60% ownership of ConsMin. 

The Territory offer is for $2 in cash for every ConsMin share plus 1.5 Territory shares and is worth $3.56 per share at Territory's share price of $1.04, or around $813 million. Territory is looking for a 90% acceptance rate.


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## kerosam (27 July 2007)

ended high $3.96... something cooking in TTY's office this weekend.

anyone as optimistic as me?


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## ta2693 (27 July 2007)

kerosam said:


> ended high $3.96... something cooking in TTY's office this weekend.
> 
> anyone as optimistic as me?




To value a company is very hard. the classic way of valuing is using multiple and NPV.  Both methods are very subjective. besides CSM is very unique, it is the only chromite ores producer in Australia. I doubt TTY and pallinghurst know the real value of CSM. The TTY have the support of Noble group and have inside information from them. pallinghurst got the support of CSM broad and have the inside information from them.  Both of them is not in a position with full information. They both are reasonable to suspect their opponent knows better than themselves. if they do think in this way, we can expect the price of CSM come into an absurd area which will out of imagination.


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## Rimtalay (28 July 2007)

Another bidder coming
*
ConsMin defies fall*

http://www.news.com.au/heraldsun/story/0,21985,22146066-664,00.html
*SHARES in takeover target Consolidated Minerals defied yesterday's market freefall, gaining 10 per cent as heavy trading sparked speculation of a mystery buyer.*

The stock gained 36c to close at $3.96, with almost 13 million shares traded - more than ten times the average daily volume traded over the past 12 months. 

Territory Resources executive chairman Michael Kiernan yesterday confirmed his company was considering an all-cash offer for ConsMin as an additional alternative to the cash and scrip bid it has already tabled. 

The company is likely to make a decision by mid-next week. 

"We all want to use the weekend and a couple of days to really consider things because this battle will be won from here with tactics and strategies," he said. 

Rival bidder Pallinghurst Resources has a $752 million all-cash offer for ConsMin on the table, which has been recommended by the ConsMin board. 

But yesterday's frenzied buying sparked speculation a third party might have entered the fray. 

Sources said hedge funds might also be taking a speculative position, with the bidding war heating up. 

The soaring stock price sees ConsMin valued at more than $900 million. 

The miner has not been valued that high since late 2005 when it was headed by Mr Kiernan. 

"This is the second time our group has made ConsMin a billion dollar company," he told BusinessDaily last night. 

"We did it once from the inside, now we've done it from the outside." 

Territory, which is backed by Hong Kong trading group Noble, Austria's DCM DECOmetal and US bankers Lehman Brothers, is offering $2 in cash and 1.5 shares in Territory for each ConsMin share. 

Pallinghurst, headed by former BHP boss Brian Gilbertson, has tabled a $3.30 a share cash bid. 

The consortium also includes coal group AMCI, investment bank Investec and US resources investor NGP Mining. South Korean steel giant POSCO has an option to take part. 

Pallinghurst last night released it's bidder's statement for the new offer. 

A shareholder meeting to consider an earlier offer from Pallinghurst, to be implemented via a scheme of arrangement, has been cancelled. 

Pallinghurst is aiming for control of ConsMin with a 50.1 per cent minimum acceptance level. 

Territory has a 90 per cent minimum acceptance level.


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## kerosam (28 July 2007)

is there a big surge in volume in another mining company listed in the ASX in the past few days? Yesterday's volume is way too high even when the annoucements for Pallinghurst & Kiernan's takeover were released. the major mining players have retraced a bit... so i guess they are out of the equation(?). maybe another overseas bidder?


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## Rimtalay (28 July 2007)

*Heavy ConsMin trade sparks third bid rumour*


*A THIRD player appears to have entered the hotly contested battle over Perth miner Consolidated Minerals, with heavy share trading and price gains on Thursday and Friday.*

The manganese, nickel and chromite miner has already received two takeover offers in recent months, one from a private equity group led by former BHP Billiton chief executive Brian Gilbertson and another led by former ConsMin managing director Michael Kiernan.

Mr Gilbertson's Pallinghurst consortium has offered $3.30 a share for ConsMin. Mr Kiernan's company, Territory Resources, has offered $2 plus 1.5 Territory shares, valuing ConsMin shares at about $3.50.

Although nearly every resource stock took a pounding yesterday following heavy losses on Wall Street, ConsMin shares rose 10 per cent to close 36 ¢ higher at $3.96.

Nearly 13 million shares changed hands, compared to an average of 1.85 million a day over the last three months.

When added to Thursday's heavy trading, the turnover on ConsMin's register approached 10 per cent in two days. The heavy buying was led by Southern Cross Equities on Thursday and by Patersons Securities yesterday, but the brokers were very active on both days.

Sources said the purchaser was likely to be an overseas party and indications were it was a corporate player rather than a fund.

ConsMin is an attractive takeover target because it controls about 10 per cent of the world's high-grade manganese at its Woodie Woodie mine in Western Australia.

Mr Kiernan said Territory was reviewing its bid and it might make an increased offer next week. "The bottom line is we've got two or three different alternatives with which we can go forward," he said.

Mr Kiernan said one of the alternatives was likely to be an all-cash bid, and it was possible Territory could raise the cash component of its current bid.

In a Bidder's Statement released yesterday, Pallinghurst provided more details of its funding for the offer. US coal group AMCI has agreed to provide at least $474.4 million, a Pallinghurst fund would provide $181.9 million from money it has not yet raised, investment bank Investec will contribute $87.1 million and NGP Mining would add $132.4 million.

South Korean steel maker Posco has an option to take over part of AMCI's stake.

Territory's bid is backed by commodities traders Noble Group and DCM DECOmetal along with US investment bank Lehman Brothers.


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## noirua (28 July 2007)

All very interesting. I notice that the UK quoted Investec shares have plunged on bad news this week and maybe the Pallinghurst consortium will have some problems there. 
Keirnans TTY stock looks very shakey; What if they plunge further?
Will markets in turmoil determine the outcome as much as the bidders themselves?


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## Rimtalay (30 July 2007)

*ConsMins battle*
Updated: 07:46, Monday July 30, 2007
*The battle for Consolidated Minerals has received a further shake up, with a foreign player believed to have paid big bucks for a seat at the table. *

Ukrainian conglomerate *Privat Group *is believed to have purchased over 10 per cent of ConsMins on Friday, sending its share price well above two current takeover offers. 

*Privat* is the world's biggest manganese alloy producer and according to Fairfax media, the group had planned to snap up at least 5 per cent of ConsMins in order to protect its supply of high grade manganese ore. 

*If Privat has acquired over ten per cent of Consolidated, it means any potential acquirer would have to negotiate with the Ukraine based company. *

The strategic stake could also mark the beginning of an all-cash takeover, rivalling Pallinghurst's and Territory's current bids. 

ConsMins is recommending a $3.30 per share bid from Brian Gilbertson's Pallinghurst, and Territory is in the process of revising its cash and scrip bid.


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## noirua (30 July 2007)

A new thread has been started for Territory Resources (TTY) at:  https://www.aussiestockforums.com/forums/showthread.php?t=7720&highlight=tty


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## Rimtalay (30 July 2007)

I now understand why Baxter is pushing Pallinghurst deal so hard – he gets GIVEN 3 million CSM shares – a $9.9m Gilbertson gift.
Read page 17 of the bidders statement.
Baxter will rip-off shareholders to get his sweetheart deal.
*IT STINKS*


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## kooka873 (30 July 2007)

RIMTALAY says:
"Baxter will rip-off shareholders to get his sweetheart deal.
IT STINKS"

Absolutely it smells most foul.
Well money speaks all languages doesn't it.
And as for ethics....................???


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## kerosam (30 July 2007)

put a stop loss at $3.65 last week and guess what? some lucky person got my thousand odd shares. i want to get back in. hope i can get back in very soon.


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## Rimtalay (30 July 2007)

*Consolidated Minerals stock price slumps as takeover plot thickens*

Ukrainian mining firm Privat Group is reported have been the buyer of a 10% stake in manganese miner Consolidated Minerals Ltd that changed hands on Friday, potentially derailing a bidding war for the Australian firm.

Shares in Consolidated Minerals closed at £3.94 on Friday on London ’ s Alternative Investment Market (AIM) but dropped a staggering 61% in early morning trading to £1.53 as reports of Privat Group’s play surfaced. Belize - based Palmary Enterprises Ltd said in a filing to the Australian Stock Exchange on Monday that it had built up a 12.1% stake in Consolidated Minerals, predominately on Thursday and Friday last week. Consolidated said it had not yet been contacted by Palmary. "We don`t know who is behind it," said David Brook, Consolidated Minerals head of investor relations.

Citing no sources, Australia’s Financial Review said Privat wanted at least 5% of the company to protect a source of manganese ore and may have decided to take 10% to force any buyer of Consolidated Minerals to negotiate or even make a bid of its own. Consolidated, which controls one of the world`s richest manganese deposits, is already the subject of competing bids from investment group Pallinghurst Resources and smaller Australian miner Territory Resources Ltd.

"There`s a group out there that now have got a blocking stake towards any potential corporate activity, so the whole process could actually be drawn out a little bit further than what was being anticipated," a dealer said.

Privat is a major customer of Consolidated through its agent DCM DecoMetal, one of the firms backing Territory`s bid, the paper said.

Territory chairman Michael Kernan told Bloomberg News that Privat has discussed the move with DCM and that discussions at this point indicated that Privat is supportive of the company`s offer for Consolidated Minerals.

Territory is expected tooffer an all - cashalternative toits A$806 million (US$708 million)cash and stockoffer for Consolidated Minerals. The Consolidated Minerals board has recommended a A$752 million all - cash offer from Pallinghurst.
(Reuters, July 30)

Privat Group is reported to enter the ConsMins takeover battle.


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## bigtbigt (30 July 2007)

If Baxter is being enticed with 3 million CSM shares, then surely that raises a immediate and serious conflict of interest. That's got to be illegal, or at least a good reason for investors demanding he resigns or turns down that offer from Gilbertson?



Rimtalay said:


> I now understand why Baxter is pushing Pallinghurst deal so hard – he gets GIVEN 3 million CSM shares – a $9.9m Gilbertson gift.
> Read page 17 of the bidders statement.
> Baxter will rip-off shareholders to get his sweetheart deal.
> *IT STINKS*


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## Rimtalay (31 July 2007)

*Kiernan claims an ally in Nikopol * Andrew Trounson, Resources | July 31, 2007 
*TERRITORY Resources executive chairman Michael Kiernan yesterday claimed Ukraine's Nikopol as an ally after the ferro-alloy maker surprised everyone on Friday, grabbing a 12 per cent stake in manganese miner Consolidated Minerals.*

But the Ukrainians have paid a premium price for their stake, and Mr Kiernan will now be under pressure to significantly raise his bid, with a decision expected later this week. 

Mr Kiernan, who was already considering hiking the cash portion of his cash-and-scrip offer for ConsMin, said he was unperturbed by the sudden emergence of Nikopol, which is owned by Ukraine's Privatbank Group. 

Nikopol is now in a position to block Territory's offer, which is conditional on securing 90 per cent of ConsMin. But Mr Kiernan has scrapped plans for offering an all-cash alternative, given the prices paid by Nikopol. 

The 90 per cent threshhold ensures full control of ConsMin and is a core requirement of Territory's backers, which include US bank Lehman Bros. 

That leaves Mr Kiernan little room to accommodate Nikopol without buying its holding. 

For rival ConsMin bidder Pallinghurst, Nikopol's move is a major concern as it may encourage ConsMin shareholders to press for a higher offer. But it isn't enough to block its bid which is conditional on 50.1 per cent acceptance. 

Pallinghurst is former BHP Billiton boss Brian Gilbertson's private equity house. 

"People could see (Nikopol) as a blocking stake, but I see it the other way. It is 12 per cent that will support us," Mr Kiernan told The Australian. "It is better it is the Ukrainians than Brian Gilbertson," he quipped. 

Nikopol is close to metal trader and Territory allies DCM DECOmetal, which supplies Nikopol with manganese from ConsMin. DECOmetal sells about 25 per cent of ConsMin's production to eastern Europe, mostly to Nikopol. 

According to Mr Kiernan, Privatbank has told DECOmetal that it supports Territory's bid. 

"Privat indicated that they were supportive of the Territory initiative," he said. 

ConsMin shares yesterday fell 32c, or 8 per cent, to $3.64 having jumped 10 per cent higher on Friday. That values the miner at $830 million.


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## Rimtalay (31 July 2007)

*Gilbertson takes aim at his own foot*
Jamie Freed, Sydney
July 31, 2007
*FORMER BHP Billiton chief executive Brian Gilbertson's criticism of Consolidated Minerals' manganese marketers seems to have backfired in a big way.*

Following heavy buying on Thursday and Friday, a Belize-based company named Palmary Enterprises has been outed as the buyer of a 12.2 per cent stake in the Perth manganese, nickel and chromite miner.

Palmary is believed to be linked to Privat, the Ukranian owner of the Nikopol manganese ferro-alloy plant. Privat buys ConsMin's high-grade manganese through Austrian commodities trader DCM DECOmetal to help feed its plant.

Although ore from ConsMin's Woodie Woodie manganese mine in the Pilbara is sold to Hong Kong's Noble Group on a life-of-mine contract, it is believed the DECOmetal sales agreement is due to lapse in about six years.

As head of the Pallinghurst private equity consortium bidding for ConsMin, Mr Gilbertson has criticised DECOmetal and the company's other marketer, Noble Group, for joining a rival bidding consortium led by former ConsMin managing director Michael Kiernan.

"The Noble contract is set in stone," Mr Kiernan said. "The DECOmetal one isn't necessarily solid and secure. My feeling is Pallinghurst will cancel that."

The substantial holding notice filed yesterday shows Palmary has been buying ConsMin shares since July 12, although it did not make large purchases until the end of last week.

"My understanding of it is it is the Ukranian group," Mr Kiernan said. "They did contact DECOmetal last week and say they were going to buy more shares. DECOmetal is in quite regular contact with them."

Mr Kiernan said ConsMin's manganese was essential for the Ukranians because it was high grade and low in phosphorous.

"The Ukranians call it black gold," he said. "I suspect (they bought the stake) to protect their supply channels. That's the way the Ukranians operate. They operate with a sledgehammer."

ConsMin investor relations head David Brook said his company had not yet been contacted by its new substantial shareholder and did not know its identity. ConsMin shares fell 32 ¢ to $3.64.


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## Aedo (31 July 2007)

Rimtalay said:


> I now understand why Baxter is pushing Pallinghurst deal so hard – he gets GIVEN 3 million CSM shares – a $9.9m Gilbertson gift.
> Read page 17 of the bidders statement.
> Baxter will rip-off shareholders to get his sweetheart deal.
> *IT STINKS*



Not quite sure where this comment comes from.   On the 16th page of the bidders statement (page number 12) the existing CSM ELTIP (executive long term incentive plan) is described (bold is mine for emphasis):


Bidders's Statement]It is Pallinghurst’s understanding that although the CSM Board has not yet allocated awards to any executive directors or senior executives under the CSM ELTIP said:


> If Baxter is being enticed with 3 million CSM shares, then surely that raises a immediate and serious conflict of interest. That's got to be illegal, or at least a good reason for investors demanding he resigns or turns down that offer from Gilbertson?



If so yes - but see comment above.


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## Rimtalay (31 July 2007)

Aedo, this has now been clarified by ConsMin, the Pallinghurst bidders statement is incorrect, Consmin will be issuing their target statement in a few days time and they will then correct the mistake. They did not realise this until I pointed it out to them. 
Mr Baxter will only get the 1 million shares as per the original vote. That is OK.
But it does say one thing, this mistake by Pallinghurst Resources is very poor, and not the sign of clever people. 
Lets wait and see what is said in the target statement, should be out next week.


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## ta2693 (31 July 2007)

Can Mr.Baxter give financial advice?
Baxter recommend shareholder to vote for and accept the bid from palinghurst. I think it is financial advice.
does he have AFSL? or Director of company does not need AFSL to give advice on his own company?


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## noirua (1 August 2007)

The TTY bid looks dead in the water as TTY shares suffer badly and plunge to just 89 cents. I thought from the beginning that the Keirnan exercise had no chance of succeeding and whether mean't to be or not, is only a spoiling exercise.

I still think the present bear market in the mining sector, be it just a short term decline or not, may end up the deciding factor. All the talk about shares to be awarded etc., is little more than a mirage. The game goes on.


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## Rimtalay (1 August 2007)

There are Questions on Pallinghurst's Bidder's Statement

•	(Credibility of claims made on Pallinghurst management team/track record) - The credibility of Pallinghurst executives' track record is questionable. There are uncertainties in the management team successfully implementing their plans/proposals on CSM.  Query uncertainty in successfully converting a track record to Pallinghurst and CSM. Query veracity of Gilbertson's track record. 
•	(Minimal CSM Director shareholdings) - Note the minimal securities holdings of CSM Directors (as follows), who have had the decision-making power in making recommendations on Pallinghurst's bid:
•	Richard Carter - holds 135,000 shares (0.0592% of issued ordinary shares) ; 
•	Bruce Brook - holds 20,000 shares (0.0088% of issued ordinary shares) ; 
•	Michael Etheridge - holds 50,000 shares (0.0219% of issued ordinary shares);   and
•	Rodney Baxter - holds No shares / 1 m options (0.4384% of expanded issued ordinary shares).  
•	(CSM Board has discretion to issue 1 m shares to Baxter) - Reference to the CSM Executive Long Term Incentive Plan, under which the CSM shareholders have authorised the issue of 1 m shares to Baxter. CSM Board now has discretion, and therefore the possibility, of issuing 1 m shares (value $3.3 m) to Baxter.  Unclear from Bidder's Statement whether this is 1 m shares per year over 3 years (i.e. 3 m shares - value $9.9 m).
•	(CSM Board's propensity in recommending Pallinghurst's proposals) - CSM has demonstrated a propensity to promptly and readily respond by recommending Pallinghurst's offers/proposals.  To date, CSM has promptly and readily agreed to Pallinghurst's proposal on the now terminated scheme of arrangement (announced on 23 February), recommended the increased offer by Pallinghurst of 25 June on the same day as Pallinghurst's increased offer and recommended the subsequent takeover bid by Pallinghurst on 20 July on the same day as Pallinghurst's announced takeover bid.  

The CSM Board appears to have agreed to the Bidder's Statement being despatched to CSM shareholders within 2 business days rather than the prescribed 14-28 day period after the Bidder's Statement is lodged.  There is a reason why the Corporations Act prescribes a 14-28 day period which is to provide the shareholders of a target company reasonable time to consider an offer.
•	(Questions regarding apparent inadequate information) - In the opinion of Territory's Board, CSM shareholders would require further information in order to consider Pallinghurst's offer.  For instance, one would expect Pallinghurst to have elaborated on the following points:


•	Pallinghurst' s vision for transforming CSM into a global mid-tier mining company by offering participation in investment opportunities, information on which is not adequately provided.  The basis for Pallinghurst making a claim that the various opportunities for rationalisation and consolidation will be "delivered in the coming months" is not detailed in the Bidder's Statement.
•	A number of statements on Pallinghurst's intentions with CSM's operations and business opportunities, the basis for which appears to be insufficiently provided in the Bidder's Statement.
•	Details on the "in-principle memorandum of understanding" with an unidentified third party, which is likely to be material given significant impact potential.
•	Information on the projects referred to (but not discussed) in page 24, including a potential transaction relating to a coal deposit in Australia.  Query the basis on which Pallinghurst has not given any further information at this time.
•	Details of the in principle contributions for US$250 million by the Pallinghurst Investor, which is referred to without details of the arrangements (including whether there are any conditions).
•	The basis for the various subjective comments made on Territory's proposal.  For instance, Pallinghurst raised the issue that there may be a potential conflict of interest between Territory's financial backers but Pallinghurst may also face the same conflicts given the potential arrangements and transactions with consortium members.
•	(Funding Arrangements) - Query as to what basis Pallinghurst has for stating it has reasonable grounds to expect that it will have sufficient funding arrangements in place to satisfy full acceptance of its offers when the bid becomes unconditional, which is required under a bid.  
•	(Funding Deed - Apparent inconsistency with claim that it is "100% equity funded") - Reference is made to a "Funding Deed" pursuant to which the "Funders" may, at their discretion, provide the funds through, inter alia, a loan arrangement.  This appears inconsistent with the description of the arrangements being "100% equity funded".
•	(Uncertainties with Pallinghurst Investor Group Structure and Board composition) - The structure of the "Pallinghurst Investor Group" and Pallinghurst's board composition have not been finalised.
•	(POSCO - arrangement with potential new investor should be clarified) - Reference to POSCO as a potential investor in the Pallinghurst investor vehicle but POSCO's involvement and its arrangement with Pallinghurst is unclear.
•	(Management Fee for Pallinghurst Resources Fund executives should be clarified) - In page 8, reference is made to CSM's access to the expertise of key Pallinghurst Resources Fund executives should the offer succeed.  Have management fees been offered to these executives under the arrangements?
•	(Break fee) - Query why CSM agreed to the $5 million break fee?


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## noirua (2 August 2007)

Breaking away, for a moment, from the complexities of share offerings etc., which although interesting, do nothing less than attempt to strangle the basics here. For that reason I will avoid them now.

The Pallinghurst Consortium have made it known that a majority 50.1% interest is all they are looking for in CSM. $3.30 is good enough for the present, that is, until others show their colours and prove theirs are not only blocking share holdings. 
There is the matter of debt, that is indicated at around $450 million, which would be put on the books of CSM, reference the TTY offer. Any other counterbid would need to show no debt as well as a bid over $3.30.
On the debt front there are thoughts that a fresh bid from another party, at around $4.00, may prove to be quite complex.


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## Rimtalay (3 August 2007)

*Privat increases its stake in ConsMin*
The board of takeover target Consolidated Minerals Ltd is seeking a meeting with Privat Group after the Ukrainian conglomerate upped its stake in the nickel and manganese miner.

ConsMin managing director Rod Baxter said the company had received a notice from Palmary Enterprises, the investment vehicle which has been amassing a stake in the company.

*"They sent us a substantial shareholder notice, Palmary is the entity ... they've actually bought another three million shares over the last couple of days so they now own 13.5 per cent," Mr Baxter told AAP.*

Mr Baxter said the notice carried the name of Henadiy Boholyubov, a major shareholder in Privat, and that ConsMin would seek a meeting with the group to discuss their motives.

"There has been no contact so we still do not know what their intentions are ... but we've sent a letter out to them asking for an opportunity to chat," he said.

Privat owns steel, energy, chemical, banking and media assets in Russia, Ukraine, Romania and the United States, and partly owns the world's second largest ferro-alloy producer, Nikopol.

Palmary, a company registered in the Central American nation of Belize, acquired a 12 per cent stake in ConsMin last week, effectively blocking its compulsory acquisition.

The 11th hour share raid has cast a shadow over the takeover battle for ConsMin involving iron ore miner Territory Resources Ltd and a consortium led by Pallinghurst Resources, a company backed by former BHP Billiton Ltd CEO Brian Gilbertson.

Territory said today an independent report backed up the company's claims its takeover bid for ConMin was superior to the Pallinghurst offer.

An independent evaluation report commissioned by Territory and conducted by BDO Consultants has estimated the iron ore miner's share price to have a range of 98 cents to $1.08.

This values Territory's cash and scrip takeover offer at between $3.47 and $3.62 per ConsMin share, or between $791 million and $825 million.

This compares to an all-cash $752 million takeover offer from a consortium led by Pallinghurst Resources, a company backed by former BHP Billiton Ltd chief executive Brian Gilbertson.

Pallinghurst is offering $3.30 cash for each ConsMin share, well below ConsMin's current share price which closed 14 cents higher at $3.79.

Territory chairman Michael Keirnan said the independent expert's report confirmed the company's market valuation.

"Territory's fully funded offer is superior to that of Pallinghurst," Mr Kiernan said.

The iron ore miner said a number of milestones achieved by the company had increased the value of its bid, including the progression from explorer to producer, the increase in iron ore prices and an off-take agreement with commodities trader Noble Group.

ConsMin, which mines manganese and nickel in Western Australia, has recommended the Pallinghurst bid.


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## noirua (4 August 2007)

noirua said:


> Starting to move with all the talk about iron ore. Scrambled on board this morning just after the train left, slightly late.




I bought into Consolidated Minerals in November 2006, quite near the floor, and decided on Friday that it was time to take profits. Often I'm too greedy and pay the penalty. In markets that are looking, at best, a bit soft, cash may well be the better option.

Some brilliant posting by Rimtalay that helped us all out. I sincerely hope CSM go on up and you all do a good bit better than me.  Goodbye and Good luck my friends


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## Rimtalay (8 August 2007)

Diggers and Dealers Mining Forum blog
Day two – Tuesday August 7

*The dirty digger?*

Michelle Wiese Bockmann, Mining Journal Editor


*So as the ubiquitous Powerpoint-supported presentations droned on downstairs, Australian mining identity and Territory Resources chief Michael Kiernan secured a half-hour slot in one of these meeting rooms to hold a remarkable media conference. Kiernan is the former Consolidated Minerals chief, and is described in Australian parlance as a “colourful character”. Both he and ex-BHP chief Brian Gilbertson are locked in an acrimonious battle to take control of ConsMin, a key Australian manganese miner. *

With all the Australian mining media under the one roof, but nothing to tell them now he had cancelled a revised offer, Kiernan clearly decided that attack was the best form of defence. Accompanied by a lawyer to stop him getting sued for defamation, Kiernan began a carefully-staged character assassination of Brian Gilbertson at his 10.30am conference. 

Kiernan had trawled the global mining media archives for the last five years. The results of this research formed a three-page `dirt file’ with sections helpfully highlighted, and from which he read for the first 12 minutes or so of the media conference. 

The resulting attack on Gilbertson and the ConsMin board (who have recommended Gilbertson’s offer over his) contrasted sharply with the dry, fact-filled company presentations underway in the main auditorium. Kiernan drew on the unflattering media commentary to construct doubts about Gilbertson’s corporate governance standards, personal agenda and competency, and the board members’ motives in endorsing the Pallinghurst bid. 

The better of these series of one-liners from his research (that won’t get Mining Journal sued) included: “Like Mohammed Ali, Gilbertson was great once”; Gilbertson had the “Midas touch for his own bank account” and an “ego the size of a planet”.

He even invoked good old-fashioned Australian parochialism, revealing a private conversation with Gilbertson in which he allegedly told of Pallinghurst plans to take ConsMin offshore, list it on the London Stock Exchange and run it from there. 

Nevertheless, Kiernan’s openness and colour was a welcome relief from media-trained executives who are giving very little away. As usual, it was like pulling teeth to get anything from Barrick Gold. The president of the Australia Pacific operations declined to give even a hint of a gold forecast, nor provide individual production figures for its mines. 

Strip away the sales patter, and even Oxiana’s showman, Owen Hegarty, gave a presentation and media conference yesterday that said very little. 

Those seeking respite in the exhibitors’ marquee found junior miners in puddles of conversation about share options, the share market and who has made how much. As the afternoon wore on, the bar opened and alcohol began flowing, talk shifted to dinner this evening and who’s eating with who. 

One thing is certain: we know who Kiernan’s dinner companions won’t be.


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## Rimtalay (9 August 2007)

*PRIVAT MEETING THE NEXT STEP *
Verbal battle continues over manganese and nickel miner Consmin
A letter has been sent by Territory Resources Ltd to shareholders of Western Australian miner Consolidated Minerals Ltd (ConsMin) urging them not to accept the offer from rival Pallinghurst group before getting "all the facts." 

Author: Ross Louthean
Posted:  Wednesday , 08 Aug 2007 

KALGOORLIE -  

Territory Resources chief executive and original founder of ConsMin, Michael Kiernan, threw several counter punches at a briefing given to mining analysts and fund managers at the Diggers & Dealers convention in Kalgoorlie immediately after presenting late yesterday for his Monarch Gold Mining Co Ltd which had just poured its first gold.

This also followed circulation of the letter at Diggers that Territory sent to ConsMin shareholders asking them to hold fire, given that they should await the full facts of Bidder and Target statements from both Territory and Brian Gilbertson's Pallinghurst.

Kiernan's shareholder letter also said that the fact Territory had joined the quest for ConsMin and that this produced a revised bid from Pallinghurst which had seen the WA manganese, chromite and nickel miner's share price lift. He claimed that on trading close on August 3, the share price was at a premium of 15% to Pallinghurst's revised offer.

"This is consistent with the Territory board's view that its offer is a superior alternative" further reinforced by the $A225 million ($US311 M) equity commitments from (bidding allies) Noble Group, DCM DECOmetal and Lehman Brothers at $A1 ($US0.86) per Territory share.

Territory's team circulated at the Diggers analysts meeting, attended by Mineweb, a share valuation report by accounting group BDO Consultants that placed Territory's share value to be in the range of $A0.98-1.08 ($US0.83-0.94) and that, according to Kiernan, Territory was well above the claims going around that Territory was only worth "two and sixpence"

He told this meeting that he would be meeting with Privat which controlled major manganese and other mining operations in Europe out of the Ukraine on the basis of seeing a joint accord. Kiernan claimed that Privat's principals had not "got on" with Brian Gilbertson and that when he was running ConsMin he had introduced the Privat group to the high grade Woodie Woodie manganese ore it was mining in WA's Pilbara as an impotant blend to its own manganese ore. There was, he said, the chance of a strong rapport with Privat.

More should be heard after Kiernan has a meeting in Europe next week with Privat the surprise third party, now holding the biggest block in ConsMin, after a surprise raid on the Australian market late last month.

Other points made by Kiernan at this meeting:

·         Territory would still sell the 27.6% stake in new WA zinc-lead-copper miner Jabiru Metals Ltd, and also the Consolidated Nickel division that operates one mine and is developing another in the Kambalda region. The intent was to transform ConsMin into a bulk mining, open cut operator.

·         Territory would introduce a high grade manganese deposit in Burkina Faso that would have some logistical challenges but involved strong government support from West African nations involved in the mining and transshipping.

·         He claimed a reason why the current Consmin board (Noble Group chief executive and Monarch director Allan Quadrio had departed) recommended the Pallinghurst bid was that a Pallinghurst Bid document showed ConsMin's managing director, Rod Baxter, would, on Pallinghurst's success, be offered a staged package of shares that could be added to 3 M that, on today's value, would be worth about $A10 M ($US8.6 M).

·         Baxter had a brief encounter with Kiernan at Diggers & Dealers at which he "conceded" that there was more than just the Pallinghurst bid on the table, contrary to the the comment in Baxter's conference presentation.

The speeches and conversations at Diggers & Dealers clearly showed the media and other observers the depth of enmity on corporate issues between ConsMin and Territory (particularly Baxter and Kiernan) - a factor not helped by Kiernan's quoted media criticism of management performance and the fact he would have Allan Quadrio installed as the new ConsMin managing director.

At the ConsMin media dinner on the eve of Diggers, Rod Baxter entertained with a tongue-in-cheek claim of a television network planning a tele-movie on the saga, in which chairman Dick Carter would be played by Arnold Schwarzenegger, that either Tom Cruise or Mel Gibson would play Baxter (Cruise would need big platform heels) and that Marlon Brando would play Kiernan. But Brando is dead! That is correct, was the retort.

He also cited an email from Brian Gilbertson apologising for not attending because he was busy with discussions with Chip Goodyear and the heads of other global majors. The so-called email said Don Argus had agreed to become the new chairman of ConsMin under Pallinghurst - a point providing great mirth to veteran journalists, as Argus was reportedly the prime mover in getting Gilbertson ouisted as CEO of BHP Billiton.

In his Diggers presentation Baxter made several points - including the financial turnaround (A $A6.5 M [$US5.59 M] loss in FY2006 to a $A30-31M [$US35.8-36.6 M] profit in FY2007) as a result of improved metal prices, notably manganese. He said the Kambalda nickel division was in growth mode after costly new mine development and a new mine would commission on the neighbouring Widgiemooltha Dome, one of the assets acquired in the takeover of Titan Resources. There were positive results from exploration for expanded manganese and chromite developments in the Pilbara.

There was no immediate intent to divest Jabiru and the market value of ConsMin's holding at June 30 was $A169 M ($US145.3 M) - an unrealised profit of $A138.2 M ($US118.8 M).


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## Rimtalay (9 August 2007)

*Territory boss launches Gilbertson broadside*
Brendan Ryan
Posted: Tue, 07 Aug 2007
[miningmx.com] -- TERRITORY Resources CEO, Michael Kiernan, has delayed revising his bid for Consolidated Mining (Consmin) so that he can first consult with Ukranian group Privat.

*
Privat bought 13% of Consmin last week and Kiernan acknowledged the group now held the position of potential “kingmaker” because Territory needs a 90% acceptance from shareholders for its offer to succeed. “We had hoped to launch a revised bid today but the move by the Ukrainians puts a different dimension on that. I need to talk to the new major shareholder in Consmin and I have set up meetings to do that next week,” Kiernan said. *

He then launched an all-out and frequently personal attack on opponents Brian Gilbertson and Consmin MD Rod Baxter as well as Gilbertson’s partner Arne Frandsen whom he dismissed as a “Norwegian nobody.”

Speaking with an Australian flag displayed on the desk in front of him Kiernan stressed his Australian roots and background. “We are Australians building an Australian group to be run by Australians unlike Brian Gilbertson who wants to run Consmin from London,” Kiernan said.

Kiernan described the Consmin board of directors as “degraders” stating that, if Territory won, the present directors; “would not be invited to the Xmas party.”

Kiernan was previously MD of Consmin but stepped down in June 2006 under pressure from certain influential shareholders. He remained a director until forced to resign from the board by Baxter and chairman Dick Carter. 

Said Kiernan: “There are a number of myths about Brian Gilbertson that need to be dispelled although my lawyers always get very nervous when I start to talk about him. 

That’s why they are here today to make sure I don’t get out of hand. Gilbertson is like Mohammed Ali, he was great once. He’s no superstar.”

Kiernan lambasted the Consmin board saying it had;”jumped to accept a series of underwhelming offers from Pallinghurst.” He added that comments by Baxter in his presentation to the Diggers and Dealers Mining Forum that the present board had added A$500m to Consmin’s market cap were; “rubbish and BS.”

Kiernan claimed the board tried to sell Consmin “for 30c in the dollar” accepting an initial bid of $2.25 a share from Pallinghurst - which was subsequently raised to $2.55 - while stating these bids were in the best interests of shareholders.

“When we put in our bid at $3.50 they dismissed it as worthless but then Gilbertson bid again at $3.30 in cash. This idiot board consists of people who don’t seem to know the real value of the company,” he said.

Kiernan also accused Baxter of being “the $10m dollar man” because of the value of the share option awards he would receive in the event of a successful takeover of Consmin. 

He said this information was not disclosed in documentation put out by Consmin but was included in the Pallinghurst bidders statement.

Kiernan has this one only partly correct because he seems to be assuming Baxter would get 3 million shares whereas it looks like he stands to get only one million. 

The Pallinghurst document reports Pallinghurst’s “understanding” that the board is authorised to award Baxter one million Consmin shares in terms of the executive incentive scheme.


Click Here to subscribe to our daily newsletterAny awarded shares would only vest with Baxter at the end of an initial three year period. However the board, at its discretion, can issue the shares earlier depending on certain circumstances one of which is a takeover of Consmin. 

Territory’s bid for CSM consists of A$2 cash and 1.5 Territory shares for every CSM share held. Kiernan said a valuation by independent consultants put a value of between A$0,98 and A$1,08 on a Territory share.

Said Tiernan: “Our bid is fully funded and locked and loaded. Our backers are the Noble group, DCM DecoMetals and Lehman Brothers. Our management team is the one that built up Consmin in the first place into a A$1bn company over a ten year period.”

Kiernan said that DCM and Noble between them hold 12% of Consmin’s equity and trade 75% to 80% of Consmin’s manganese and 100% of its chromite. He added that DCM trades extensively with Privat.

€œWhen I meet Privat they will be assured of their manganese supply from Consmin ,” Kiernan said.


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## bigtbigt (9 August 2007)

I'm impressed by and grateful to the well-informed posters on this bb. ...and to them I have a question: since this saga is yet to run its full course, what do you anticipate is the best option for shareholders like me that want to keep as big a slice of CSM as I can for the next few years (since its massively undervalued). Might it be best to just sell up now, and reinvest in NewCSM once its formed, rather than be diluted by new share issuances etc?


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## Sainter (9 August 2007)

If you believe, hold and do nothing at this stage-if Pallinghurst gains 50.1%, they will take you along with them for the ride. If TTY puts in a bid, the shareprice will go up from here. I sold 30% of my shares last week for $3.76, but continue to hold the rest.
Cheers!


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## Rimtalay (10 August 2007)

www.metal-pages.com/subscr/story.php?id=28571"><strong>Read more&#8230

Manganese prices have started to rise futher, good news for ConsMin. Already receiving record prices.

* "Chinese manganese prices jump on tight supply
Chinese manganese flake prices have surged by one fifth in the past week on tight availability caused by widespread smelter shutdowns seen last month, according to market sources. Domestic prices for 99.7% grade electrolyte metal are around Rmb22,000-22,500/tonne "*


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## ta2693 (10 August 2007)

CSM is not risky at all. 3.30 is the bottom line. Does anyone disagree? 
even in the worst case, you only lose 11c. Besides Mn price in China is rising. China have new regulation on Mn producer. basically their cost will go up, because they need to put more money into waste water processing and environment protection. a lot of small Mn producer will be shut down for environment reason. There will be less Mn supply in short term (1 year), but the demand is still there. I am pretty bullish on CSM.


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## doctorj (10 August 2007)

ta2693 said:


> CSM is not risky at all. 3.30 is the bottom line. Does anyone disagree?



I do and in fact, you do as well.  You disagreed with yourself in the very next breath


ta2693 said:


> even in the worst case, you only lose 11c.



Nothing is riskless.  It can be low risk...


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## ta2693 (10 August 2007)

doctorj said:


> I do and in fact, you do as well.  You disagreed with yourself in the very next breath
> 
> Nothing is riskless.  It can be low risk...




I do not think the offer below 3.30 will appear on market before 1st sept.
If anyone want to sell below 3.30 he had better fill the blue slip and send to PRAL.  

The market is volatile, but arbitrage opportunity should not exist on company like CSM.


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## Rimtalay (11 August 2007)

ConsMin produces 2 commodities which are now entering the bull arena.
1) Manganese - already up 150% in the last few months and now heading higher
2) Chrome ore - ConsMin is the only producer in Australia, Baxter now says in hime Digger and Dealers presentation that next deliveries are at US$200/ton FOB up 25%. 
This is just the start for chome ore, Baxter missed the boat earlier in the year, but hopefully he is now more aware of the chrome ore market. You will see further gains in the chrome ore price in thge near future.

Global production of ferrochrome currently is approximately 6 million tpa. South Africa, through the massive extent of its Bushveld chromite ore reserves which constitute about 73% of global chromite ore reserves, is destined to continue to play the dominant role in the supply of ferrochrome and even expand its participation in the global market. 



The principal use of ferrochrome is in the stainless steel industry, which consumes around 90% of the approximately 6 million tpa of ferrochrome currently produced. Ferrochrome is added to stainless steel for its corrosion and oxidation resistance properties. Stainless steel typically contains up to 18% chrome units and, unlike nickel and molybdenum which can also be added to further enhance particular properties of stainless steel, there are no direct substitutes for ferrochrome. 



Ferrochrome is also used in the production of alloy steels to provide anti-corrosion and heat resistance properties. As the stainless steel sector consumes approximately 90% of total ferrochrome production, it is this sector which is of primary relevance to the Project and the Group’s access to the ferrochrome market. 



A distinction should be drawn between the two types of ferrochrome produced. South African ferrochrome, known as Charge Chrome, in comparison to High Carbon Chrome produced in Kazakhstan and certain other countries, benefits from having a large proportion of ‘free’ high priority iron units as well as high silicon content. This chemical composition reduces the stainless steel manufacturers’ need for charging the furnace with ferro-silicon, thereby reducing their costs. As a result South African Charge Chrome is the preferred alloying element amongst stainless steel producers and comprises 85% of ferrochrome used in the stainless steel industry. 



The remaining 15% of the market is predominantly made up of High Carbon Chrome which tends to be utilised in developing countries, such as China and India which have tended to deploy induction furnaces to manufacture stainless steel. Historically furnaces used High Carbon ferrochrome but all new furnaces, including those being built by Jisco, are designed to use Charge Chrome. 



The stainless steel industry is characterised by buoyant long term growth rates, well above those of most other metals. The long term stainless steel consumption growth rates of approximately 5% over the past 20 years are far in excess of growth rates for copper or aluminium over the equivalent period, at 2.3% and 2.1% respectively. China’s demand for stainless steel has grown at 21% per annum over the last 10 years, this is 4 times the global average. 





South Africa has consistently been one of the industry’s most competitive suppliers of ferrochrome. This exceptional competitiveness is a culmination of several factors: 

• extensive ore resources; 

• large smelters and state-of-the-art technology; 

• skilled work force and management; 

• low electricity cost; and 

• a traditionally weak Rand/US$ exchange rate. 



South African producers are the accepted price setters in the market and their pricing policy is generally followed worldwide. As the South African producers’ costs are incurred in Rand it is only natural for them, as market price setters, to set the US$ price they receive on the basis of an acceptable profit margin over their Rand based production costs. 





The information above has been accurately reproduced from such reports and as far as the Company is aware and is able to ascertain from information published by MBR and Heinz Pariser, no facts have been omitted which would render the reproduced information inaccurate or misleading.


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## Rimtalay (11 August 2007)

Watch the prices of Chrome ore. ConsMin the only producer in Australia.
(RML in the Phillipines another would be producer to look at)

Chrome ore and ferro-chrome the next bull market.

*Merafe ramps up production to cash in on record ferrochrome demand*
With the international ferrochrome market likely to remain in a supply deficit until 2010, and prices expected to remain at record levels, local producer Merafe Resources said it planned to beef up production and have all 20 furnaces operational by the year-end.

The company, which shares ferrochrome operations with Xstrata, has already brought five out of seven furnaces that had been closed in 2006 to push prices up, back into production this year.

Two furnaces would be brought into production before the end of the year, which would increase the volumes of ferrochrome available for sale by 195 000 t/y. Merafe Resources’ attributable sales volumes from Project Lion, which would ramp up to full production by the last quarter of the year, would also increase.

The company’s nameplate capacity was 1,96-million tons a year and, by the end of 2007, it planned to produce 1,76-million tons.

Merafe FD Stuart Elliot said that the international ferrochrome market would be in a supply deficit for at least another three years, as limited additional capacity was coming on stream.

And, should companies start entering the ferrochrome business in an attempt to cash in on high prices, it would take at least three years to get a new operation up-and-running, as a result of long lead times associated with the world-wide engineering skills shortage.

The international market for ferrochrome, an ingredient used in the manufacture of stainless steel, would have to increase supply faster than the growth in the stainless steel industry in order for supply to catch up with demand, but CEO Steve Phiri said that this was not currently the case.

He explained that stainless steel production was anticipated to increase by 5% year-on-year in 2007, to almost 30-million tons a year, which would mean that ferrochrome production had to realise at least the same percentage growth.

The supply deficit was further driven by strong demand from China, where stainless steel production growth of around 38% year-on-year was anticipated to an estimated production of 6,8-million.

“China is our number one priority,” Phiri said, adding that by the end of 2007, the company would have increased its sales into that country to 20%.

Merafe had struggled for some time to enter the Chinese market, and in 2006, its sales into that market was 0%. But he said that an improved marketing effort and continued effort to build relationships had seen the company making inroads into China.

The strong demand for ferrochrome had resulted in prices increasing to $1/lb this year and the company was expecting prices to remain strong.

Phiri cautioned that, over the medium term, prices could soften, but that increased demand for the metal would result in high prices over the long term.

He was confident that the market had matured and that the cyclical nature of ferrochrome was “something of the past”.


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## Rimtalay (12 August 2007)

*Territory boss to meet ConsMin investors*
 August 12, 2007 - 5:24PM


*Territory Resources Ltd Chief Executive Michael Kiernan is flying to Ukraine to meet with investors he hopes will join his consortium to buy Consolidated Minerals Ltd (ConsMin).*

Ukrainian conglomerate Privat Group secured a 13.5 per cent stake in ConsMin, casting a shadow over the takeover tussle being played out by Territory and a consortium led by ex-BHP boss Brian Gilbertson.

"The territory offer which is currently on the table and fully funded, does have a condition of a 90 per cent acceptance so that we can then compulsorily acquire the company," Mr Kiernan told AAP from the airport on Sunday.

"With the Privat, Ukraine people stepping into the frame, one would have to ascertain what is in their minds.

"I am certainly travelling on the way to Europe to meet with the Privat people who are well aware of our group."

Mr Kiernan, who aims to meet with Privat on Monday or Tuesday, claims that it was him who introduced Privat to the high grade manganese from ConsMin's Woodie Woodie mine, which it now uses at its Nikopol smelter, the world's largest manganese alloy producer.

Privat owns steel, energy, chemical, banking and media assets in Russia, Ukraine, Romania and the United States.

"The Nikopol people are very keen to maintain their continued supply of Woodie Woodie manganese ore," Mr Kiernan explained.

Mr Kiernan said investment company Pallinghurst had expressed the desire to become an integrated supplier of manganese, which would include running its own smelters.

"I'm meeting with the Privat people, who are the major owners of Nikopol, just to ascertain if we can come to some accommodation with each other where they are guaranteed their supply and how territory can still acquire the assets of Consolidated Minerals," Mr Kiernan said.

He is hoping the Privat Group will become part of the Territory-led consortium trying to gain control of ConsMin, which also includes Austrian commodity trader DECOmetal and investment bank Lehman Brothers.

The ConsMin board has recommended a Pallinghurst offer of $3.30 cash per share, which is valued at $752 million.

This is despite a rival bid from Territory for $2 cash and 1.5 Territory shares for each ConsMin share, which it says values ConsMin at $966 million, but Michael Kiernan has flagged its intention to launch another bid.


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## Rimtalay (14 August 2007)

*When miners go for the vein, it's the jugular*
Mark Hawthorne
August 14, 2007

*FULL DISCLOSURE*

THE dust has finally settled over Kalgoorlie after this year's Diggers & Dealers mining industry drinkathon, but the words of Territory Resources chief Michael Kiernan continue to ruffle a few feathers.
The former Subiaco truck driver is battling a Pallinghurst Resources-led consortium for control of Australia's Consolidated Minerals.
Pallinghurst is run by former BHP Billiton boss Brian Gilbertson.
Kiernan was managing director of ConsMin until June last year. He was forced to resign by new MD Rod Baxter and chairman Dick Carter.
Should Kiernan win control at ConsMin, there's little doubt that Baxter and Carter's days would be numbered.
Few saw the spat coming on the opening Sunday of Diggers, when Kiernan hosted a function at Kalgoorlie Race Course.
Kiernan reportedly played his cards close to his chest. Not so Baxter, who later that same day hosted a ConsMin function at The Hannan's Club in Kalgoorlie, and fired a few salvos in Kiernan's direction.
ConsMin's board has backed the Pallinghurst offer, and Baxter suggested that shareholders shouldn't worry about Kiernan, as there were "South Africans offering you a better deal".
He also joked that, should a movie be made of the ConsMin saga, Marlon Brando could play Kiernan. "Brando is of course dead, but that's fine by us," he said.
It was enough to fire Kiernan into action. He booked a meeting room at Kalgoorlie's art centre, draped the desk in an Australian flag and brought in a solicitor to vet his words.
Reading from a three-page document, Kiernan let fly.
"We are Australians building an Australian group to be run by Australians, unlike Brian Gilbertson, who wants to run ConsMin from London," he said.
He added: "There are a number of myths about Brian Gilbertson that need to be dispelled, although my lawyers always get very nervous when I start to talk about him. That's why they're here today ”” to make sure I don't get out of hand. Gilbertson is like Mohammed Ali, he was great once. He's no superstar."
He also added that the South African had a "Midas touch for his own bank account" and an "ego the size of a planet".
Kiernan described Consmin's directors as "degraders" and said that, if Territory won, the board "would not be invited to the Christmas party".
Kiernan then called Baxter "the $10 million man", a reference to his share options in the event of a successful takeover of ConsMin.
After the remarkable outburst, Kiernan headed out for the Ukraine for some crucial meetings with directors of Privat Group.
After the remarkable outburst, Kiernan headed out for the Ukraine for some crucial meetings with directors of Privat Group.
Privat ”” controlled by the Ukrainian businessmen Henadiy Boholyubov, Oleksiy Martynov, and Ihor Kolomoysky ”” bought 13 per cent of ConsMin last week, in order to secure its manganese supply, and will play king-maker in the ConsMin deal.
Over the next few days Kiernan will try to convince Privat to join his consortium to win ConsMin.
They will at least like Kiernan's pull-no-punches style. One of Privat's directors, Kolomoysky, is famous for saying: "Life is a supermarket. You can take whatever you like, but the cash desk is at the end."
Privat is embroiled in a fierce business and political rivalry with Ukrainian billionaire Viktor Pinchuk and his Interpipe Group.
Both want control of the co-owned Nikopol Ferroalloys Plant ”” the final destination of much of ConsMin's manganese.
Such is the ferocity of business dealings in the Ukraine that Henadiy Korban, a Privat manager and Pinchuk critic, survived an assassination attempt last year. Korban's bodyguard was badly hurt.
Kiernan's potential new business chums hardly sound like the types you'd want at the office Christmas party, either.
Pallinghurst, meanwhile, is demanding that Territory makes a formal statement of intention, after media speculation that Kiernan would increase his offer for ConsMin following his trip to the Ukraine.


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## Rimtalay (15 August 2007)

Price of chrome ore up further.

*Price Of Charge Chrome For Q3 - 07 Is Reluctantly Settled By Rise Of 18 US-Cents / Lb.  
= Nippon Steel & Sumikin Stainless Steel Corp., Decision Was Made For Marathon Negotiations *
The negotiations with stainless steel companies in Japan on price of South African charge chrome to be purchased by them for shipments in July - September quarter of 2007 had taken so long time as marathon race but Nippon Steel & Sumikin Stainless Steel Corp. notified on the 2nd of August that a rise of 18 US-Cents per lb. has been agreed by us. Accordingly, its benchmark price will come to 108 US-Cents per lb. as the highest one in its history.

The two South African producers of Samancor Chrome and Xstrata Alloys participated in the negotiations. Apart from the price of South African charge chrome settled for April - June quarter, in the course of July - September quarter when LME nickel prices have fallen to a considerable extent and a circle to decrease stainless steel production is spreading over the world, stainless steel mills in Japan and South Korea have decided to decrease their production of stainless steel, causing an emergent aspect. On the other hand, a tightness on supply situation of ferro-chrome has still continued at present.

In a ravine of the two matters which the request to save cost for production of stainless steel and the requirement to rise substantially price of charge chrome being backed by the tightened supply in July - September quarter placed by producers before consumers, the marathon negotiations were taken place as an extraordinary case. However, it is thought that, by taking into consideration of the sustainable relationship between suppliers and consumers to be maintained for a long period, Japanese side has to incline to reach an judgment to agree to a rise of 18 US-Cents per lb. for July - September quarter, which European mills have already accepted.


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## noirua (16 August 2007)

Some of the bidders for CSM may be wobbling a bit and the chance remains that one or more could pull out. Investec may be thinking again about their part in the Pallinghurst Consortium and the plunging price of TTY in these markets are a second factor for the Kiernan bid.

One of the reasons for plunging mining stocks is that takeover bids are now unlikely. What looked great 2 weeks ago now looks very expensive. 

I have sold my CSM stock (post 407), so take this into account when you read the above, as it's very much, IMHO.


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## noirua (17 August 2007)

noirua said:


> Some of the bidders for CSM may be wobbling a bit and the chance remains that one or more could pull out. Investec may be thinking again about their part in the Pallinghurst Consortium and the plunging price of TTY in these markets are a second factor for the Kiernan bid.
> 
> One of the reasons for plunging mining stocks is that takeover bids are now unlikely. What looked great 2 weeks ago now looks very expensive.
> 
> I have sold my CSM stock (post 407), so take this into account when you read the above, as it's very much, IMHO.





***An ASX announcement this morning states that Pallinghurst ( Pallinghurst Consortium ) have withdrawn their on-market order for 11.35 million shares at $3.30***


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## noirua (17 August 2007)

It does look as if the parties over and those who are able to sell into the market for the promised $3.30 should give it a great deal of thought. Pallinghurst look to be considering their options here and may back out and the TTY Kiernan bid looks like going the same way.


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## Rimtalay (17 August 2007)

noirua said:


> It does look as if the parties over and those who are able to sell into the market for the promised $3.30 should give it a great deal of thought. Pallinghurst look to be considering their options here and may back out and the TTY Kiernan bid looks like going the same way.




Noirua, you are 100% WRONG. Are you one of those people who panic and follow the herd?? Obviously you don't know WHY, Gilbertson or Kiernan want ConsMin. Gilbertson will NOT BACK OUT, he is trying to scare the SUCKERS and FOOLS.
ConsMin has the largest independent high grade manganese deposit close to China and the ONLY viable chrome ore deposit in Australia. Prices for MN and Cr2O3 are up 140% Mn and 50% Cr2O3, and trending higher. 
China has not slowed, not a single ton less has been shipped to China.
Buy a ticket to China, go have a look.


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## bigtbigt (18 August 2007)

Please someone decode this for me, remembering I am UK investor with CNM shares on the AIM...

"  Pallinghurst has decided to withdraw its standing on-market order on the ASX to acquire upto 11.35 million Consolidated Minerals shares at $3.30. The withdrawal will be effective after the close of trading on the ASX tomorrow. Consolidated Minerals shareholders that wish receive early payment for their shares (that is, within 3 business days), must seel into the on-market order by 4.10pm on Friday August 2007.
  The Pallinghurst off-market takeover offer for Consolidated Minerals (Pallinghurst cash offer) will remain open after this time, but is scheduled to close at 7.00pm (Melbourne time) on 1 September 2007 (unless extended). Shareholders that accept the Pallinghurst Cash Offer will receive payment within one month after the later of teh date taht they accept and the date that the Pallinghurst Cash Offer becomes unconditionnal or in any event no later than 21 days after the end of the offer period (assuming the offer becomes unconditional)."

I note that in the 6 August Corporate Acion letter I received, the deadline for registering my YES vote is 24 August.

So please confirm or correct my interpretation that: being a UK/AIM investor my only mechanism for getting their $3.30 per share was to register YES to Pallinghurst's bid for CNM. I never did have the option of selling shares on market for that price whilst not voting YES, since this option is restricted to Aussie market [though of course, selling them shares = sellinges votes]. So, despite their recent announcement, I still have the option of voting YES and will the get $3.30 per share assuming the overall Pallinghurst bid for CSM is eventually successful (assuming it is not withrawn ater 1st September).

Also, 
- when now will the Pallinghurst bid be voted on?
- anything new from Kiernen?

More generally, I never got the logic of offering to buy shares on market for less than market price - why would investors go for that? But now it makes sense. He was banking on a probable fear-inducing pull back in SP after the recent buying by East Europeans. And boy did he get his wish ...market has dropped to/below the 3.30 offer, and so people fear it going even further down (with global drops) and so they are probably going to sell & vote YES to Pallinghurst in droves. Consequently, in the absence of a new Kiernan bid or sudden global market turnaround (both looking less likely), I think Pallinghurst will win. Given this belief, what should one do...?  ...stay in while everyone else sells in fear (fear cleverly amplified by Gilbertsons recent announcement about cancelling offers)! ...because whatever you think of Gilbertson personally, he will eventually start to bring out the true share value of this Co, and you can then go along for the ride (after perhaps a blip down while his plans become clear).  Remember, he wouldn't be doing all this at 3.30 unless he was 110% confident he could get $10+ for each current share equivalent after a year or two.


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## noirua (19 August 2007)

Rimtalay said:


> Noirua, you are 100% WRONG. Are you one of those people who panic and follow the herd?? Obviously you don't know WHY, Gilbertson or Kiernan want ConsMin. Gilbertson will NOT BACK OUT, he is trying to scare the SUCKERS and FOOLS.
> ConsMin has the largest independent high grade manganese deposit close to China and the ONLY viable chrome ore deposit in Australia. Prices for MN and Cr2O3 are up 140% Mn and 50% Cr2O3, and trending higher.
> China has not slowed, not a single ton less has been shipped to China.
> Buy a ticket to China, go have a look.




Hi rimtalay, I sold my CSM shares as posted recently. Holding cash, I'm considering my options here.  The market price is all I'm interested in and interesting this contest is, and truths and lies be they told a plenty.


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## Rimtalay (19 August 2007)

*MINING FINANCE AND INVESTMENT
BETTER VALUE OFFER? *
Kiernan brings the Territory/Consmin message to London, secures Privat support
*The ongoing battle for control of Western Australian miner ConsMin between the Pallinghurst group and Territory Resources has reached a new level with Territory claiming an alliance with Privat. But will that put the Brian Gilbertson-managed Pallinghurst out of the race?*

Author: Lawrence Williams and Ross Louthean
Posted:  Thursday , 16 Aug 2007 

LONDON and PERTH -  

In a special presentation in London to mining and financial journalists, Territory Resources' chairman, Michael Kiernan, set out his vision for a combined Territory/Consmin entity as part of his battle to woo Consmin shareholders based in the UK in the direction of the Territory take-over offer.  He also told the media that Privat, one of Consmin's major customers with mines and metallurgical works in the Ukraine, and which has secured a 13.5% stake in ConsMin, would be ‘supportive' of Territory's bid. Indeed Kiernan's flying London visit followed a visit to Austria to meet with DCM DECOmetal and Privat.

What does this mean?

If Privat is firmly behind Kiernan then the former chief executive of ConsMin can count on having secured more than 25% support - through the collective holdings in ConsMin of Kiernan's long term associate Noble Group of Hong Kong and the holding of new associate in the Territory bid, metal house DCM DECOmetal which together hold around 12% and, assumedly, Privat's holding.

The situation, at present, is that Brian Gilbertson's London headquartered Pallinghurst Group has put in an offer for Consmin (ASX: CSM, AIM: CNM, FSE: CMN) at A3.30 a share - a little below Consmin's current stock price of A$3.42 a share, while Territory (ASX: TTY) has made a combined cash and stock bid of $2.00 a share cash plus one and a half Territory shares, which Michael Kiernan values as worth around $3.55 based on an independent valuation of Territory at just over $1.00 a share.  The only problem with this calculation is that Territory's shares have fallen back in the recent stock market malaise to $0.68 a share today which would only value the offer at A$3.00 a Consmin share.

Both Territory and Consmin profess a vision for their combined entities in the greater iron and steel sector - as the providers of alloying materials.  *Consmin has some of the world's best manganese assets, and also interests in chromite and nickel,* while Kiernan's Territory also has iron ore to bring to the package.  Gilbertson looks to Consmin as being a vehicle for a major international production of manganese, and has his eyes on manganese deposits in Southern Africa which could be brought into the equation.  Both probably see Consmin as undervalued, although Michael Kiernan, himself a former chief executive of Consmin, makes the statement that he feels the current Consmin board has taken its eye off the ball on operational matters and has made it no secret that he would replace the Board should Territory's bid be successful.

There has obviously been some personal animosity involved in the dealings to date.  It would seem that Territory might hold the aces in this, with the backing of Consmin's biggest shareholders and customers in Privat, Noble Metals and DCM DECOmetal. 

Despite this backing, Consmin's Board has been decidedly hostile to the Territory bid and, according to Kiernan, been decidedly unhelpful in access to financial data.  The Board has, meantime, recommended the Pallinghurst offer unreservedly.

The question then is will the customer support for Territory be enough to douse Pallinghurst which has already produced an upgraded second offer for ConsMin. One thing is certain no peace pipes have been smoked, given the utterances at the Diggers & Dealers Forum in Kalgoorlie last week by Kiernan and by ConsMin's managing director Rod Baxter whose board has made it clear its current directors support Pallinghurst's bid.

Soon after Diggers the Takeovers Panel linked to the Australian Stock Exchange said it had received an application dated August 13 in which Pallinghurst submitted a number of concerns about statements by Territory in relation to both its bid for all of ConsMin's ordinary shares, and Pallinghurst's bid for ConsMin. 

Takeover Panel's director Nigel Morris said Pallinghurst seeks a declaration of unacceptable circumstances, and orders that Territory make various corrective disclosures and issue a formal ‘statement of intention' with respect to the consideration payable under the Territory Bid.

"In particular, Pallinghurst seeks orders that Territory confirm the consideration offered or to be offered under the Territory Bid will be varied, along with the nature of the variation and time of effect, or alternatively, confirm the consideration under the Territory Bid will not be varied."

Morris said the Panel had not decided whether to conduct proceedings in relation to the application. "It notes that it has not received submissions from other parties to the application and makes no comment on the merits of the application." However the President of the Panel is appointing a Panel "to consider the application."

When the next shot is fired in this battle is uncertain, but at the time of writing it was likely to be early next week from Territory's side when Michael Kiernan is due back in Perth from Europe.

Kiernan meanwhile made it apparent in is London briefing that Territory is indeed prepared to vary the terms of its offer (i.e. increase it) and claims to have the financial backing from his bid partners - Noble Metals, DCM Decometal and Lehmann Brothers, to enable it to do so if necessary and if markets justify this.  Given that he firmly states that the Pallinghurst bid undervalues Consmin, then there may well be scope on both sides for a further upping of the stakes.  Territory's Bidders Statement to Consmin shareholders is due out in the next couple of weeks and it will be interesting to see if any changes will be made in this time, or subsequent to it.  This takeover battle seems to have some way to run yet.


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## Rimtalay (21 August 2007)

A THIRD player has entered the takeover battle for Perth-based manganese miner Consolidated Minerals, raising the prospect of a counter-bid emerging to trump rival offers from private equity group Pallinghurst and former ConsMin boss Michael Kiernan's Territory Resources.

The new entrant started due diligence work on ConsMin yesterday and is believed to be an offshore player. 

It is not believed to be the Ukrainian-based Privat Group that has manganese alloying operations and has grabbed a 13.5per cent stake in ConsMin. There is some speculation that it is another European alloyer, possibly Norway-based Tinfos. 

ConsMin yesterday said it had granted due diligence to a third party, after last week receiving a "confidential, non-binding, indicative and incomplete approach" from the unnamed group. "We don't have a definitive proposal from them, but they said they wanted to do due diligence and we've granted that to them," a ConsMin spokesperson said. 

"Once they've done that, they may or may not come with a formal proposal." 

Pallinghurst, which is led by former BHP Billiton chief executive Brian Gilbertson, announced yesterday it had secured a 5.19 per cent stake in ConsMin. 

The ConsMin board has recommended the Pallinghurst all-cash offer of $3.30 cash a share, which is valued at $752 million. 

Territory is offering $2 cash and 1.5 Territory shares for each ConsMin share, valuing the nickel and manganese miner at about $696 million. Territory is backed by commodity traders Noble Group and DECOmetal and investment bank Lehman Brothers. 

ConsMin shares added 11c to $3.34, while Territory gained 1c to65c.


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## noirua (21 August 2007)

Prices for stainless steel flat products and Nickel/Chrome/Molybdenum have not been as strong as has been mentioned and in some cases appear to be weakening:  http://www.crumonitor.com/80256B48004C7375/vWeb/wpCWAN56XHA8 http://www.crumonitor.com/80256B48004C7375/vWeb/wpCWAN56XHZN


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## Rimtalay (21 August 2007)

Hi Noirua,
Sorry to dispute your findings, but ConsMin produces manganese not moly. Manganese has increased further. I would like to introduce you to some professional commodity trading websites
www.asianmetals.com
www.metal-pages.com
www.ferro-alloys.com
Read the bottom of this commodity bulletin and you'll note the price of Australian 48% Mn ore ( ie ConsMin Mn ore) note 65-67yuan/dmtu = US$8.56 -8.82/dmtu . ConsMin's contracts for Sept -Oct 07 is for US$7.25- 7.40/dmtu. 
This new price is US$1.25/dmtu higher than contract prices. This will mean that next contracts will be settled higher, US$1.25/dmtu means another $80 million profit.

Manganese ferroalloy] early August manganese ferroalloy market analysis

Enter August, ferroalloy products showed signs of rising, especially iron and molybdenum Electrolytic Manganese rose very obvious, but the main reason is in August after the cash shortage. In mid - to late July to early August, the south part of the disaster mines and smelters home production affected to a certain degree, resulting in a sharp decline in output. Since July of steel procurement of raw materials off-season, ferroalloy production the impact does not seem apparent, ferroalloy market also made plain in late July the market to maintain a stable situation. But in the August, as demand for steel gradually restored, the supply of hidden contradictions gradually emerged, some ferroalloy product prices have risen accordingly.

Electrolytic Manganese DJMn99.7 price increases are very strong, but at the current market price, confusion has emerged tight supply on the market. In late July manufactured quotations in the domestic 17300-17500 yuan / ton to early August prices have risen 20000-21000 yuan to the price, ended last weekend (August 10) the area manufacturers are generally Price 22000-22500 yuan / ton, or even individual manufacturers reported 23,000 yuan / tons of high prices, while most manufacturers face a rapidly rising market is no longer offer. Not only manufacturers, including consumer and commercial traders of all market participants need time to adapt and accept such a market. 

By contrast, manganese, silicon, manganese prices stable, manganese ore prices will not continue weak. It is learned that the ports along the supply of manganese ore spot tense situation, *48% of Australian ore prices for the 65-67 yuan / ton*, Gabon 46-47% of the manganese ore prices 62 yuan / ton degrees. HCFeMn 65C7.0 current prices in 7200-7500 yuan / ton, carbon ferromanganese prices in the mainstream 17000-18000 yuan / ton; Domestic silicomanganese prices, FeMn65Si17 Price in the southern part of the 7300-7500 yuan / ton, in the northern region Price 7600-7900 yuan / ton .


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## noirua (22 August 2007)

Nickel and chrome prices are weaker now and they are mined by Consolidated Minerals. 

Companies generally have forward contracts for sales which are up to one year ahead and as we know, they may sometimes have to buy in ore to make up shipping orders. They also sell ore, that is over production, at spot market prices. So pointing out forward prices for contracts tends to forget the affect of recent events and the credit crunch in the USA, that is gradually being admitted elsewhere as being a problem. 

The value put on Consolidated Minerals assets is sometimes inflated by failing to take certain matters into account. Taxation, and that includes taxes on capital gains. The cost of mine development and infrastructure is a seriously heavy expense and until fully funded is a risk factor that can lead to a reduction in value of as much as 50%. The asset valuations, often given, are heavily skewed to a figure that forgets the above factors.


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## Rimtalay (22 August 2007)

noirua said:


> Nickel and chrome prices are weaker now and they are mined by Consolidated Minerals.
> 
> Companies generally have forward contracts for sales which are up to one year ahead and as we know, they may sometimes have to buy in ore to make up shipping orders. They also sell ore, that is over production, at spot market prices. So pointing out forward prices for contracts tends to forget the affect of recent events and the credit crunch in the USA, that is gradually being admitted elsewhere as being a problem.
> 
> The value put on Consolidated Minerals assets is sometimes inflated by failing to take certain matters into account. Taxation, and that includes taxes on capital gains. The cost of mine development and infrastructure is a seriously heavy expense and until fully funded is a risk factor that can lead to a reduction in value of as much as 50%. The asset valuations, often given, are heavily skewed to a figure that forgets the above factors.




Noirua,
Yes the price of nickel is now lower, BUT ConsMin was hedged for most of FY 07 at prices FAR less than the price of nickel now at US$12 spot price. They are no longer hedged. If you think that nickel is going down, then as I said before buy yourself a plane ticket to China. Take a trip around the country, like Chengdu, Kumming, Yichan, places analysts never talk about, and most likely have never been. 
Yes, the price of chrome ore is a LITTLE softer, BUT ConsMin's contracts last year DID NOT get much of these increases. In fact their prices for new contracts now are 25% higher than last year.
Again, the softening is only a leveling off getting ready for another leg up. I 'm in contact with a manager of a chrome producer in the USA and he is very bullish on Chrome ore, ferro-chrome etc going forward.
If ConsMin doesn't make $50 million NPAT FY08 then we can say that you are right, but I bet they will make $100 million PLUS. So we'll see who is right.
Why do you think Gilbertson, Kiernan and now ferro-alloy producer Tinfos want ConsMin, because it's cheap for the commodities it produces.
Did you read what Keith Goode said of CSM in his latest research note?


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## Rimtalay (28 August 2007)

*Tinfos firms as rival suitor for ConsMin*

28th August 2007, 9:30 WST



*Norwegian ferro-alloys producer Tinfos has boosted expectations that it is seriously considering its own $1 billion offer for Consolidated Minerals, engaging a Sydney-based public relations firm to represent it in Australia. *

Tinfos, the world’s biggest producer of low-carbon silico-manganese and a significant supplier of titanium dioxide slag and pig-iron, was granted access to ConsMin’s books last week after indicating its potential interest in making an offer for the WA manganese and nickel miner. 

At the weekend it engaged Sydney PR firm Third Person to work on its behalf, sending a clear signal that a third bid for ConsMin is likely.

Tinfos currently has no operations or even customers in Australia, making the engagement of a PR firm pointless unless it is planning to establish a substantial base here. 

Importantly, it is now understood that Tinfos is acting completely independently of any other party, and has sufficient financial firepower to proceed with a stand-alone bid. 

Nor is the privately controlled company, which is 68 per cent owned by Norwegian group Holta, itself up for sale as had been rumoured. 

Last week, speculation suggested Tinfos was a front for other interests eyeing ConsMin, rumoured to include Ukrainian group Interpipe, which shares ownership of ferro-alloy producer Nikopol with 14 per cent ConsMin shareholder Privat Group. 

Tinfos was established more than a century ago, employs more than 500 people across Europe, the US and Brazil, and last year generated total sales in excess of $1.2 billion. 

But Tinfos’ late appearance has further taxed the patience of Brian Gilbertson’s Pallinghurst Resources, which yesterday turned up the heat under ConsMin shareholders to accept its board-endorsed $3.30-ashare cash bid. 

Pallinghurst extended its offer by another week to September 13, but ruled out any further extensions unless another offer emerged from rival bidder Territory Resources or any other party. It also pledged to declare its offer unconditional if it secured at least 35 per cent of Cons-Min by next Tuesday. 

After picking up 5.3 per cent of ConsMin shares just over a week ago, it yesterday revealed it had also acquired another $30 million in convertible notes that could potentially double its stake. 

Despite expectations that either Territory or Tinfos will make a new offer for ConsMin, Pallinghurst said it believed the chances of a “deliverable and superior offer materialising from them to be low”. 

The warning sent ConsMin shares tumbling 10 ¢ to $3.65. In comparison, Territory closed 3 ¢ higher at 87.5 ¢, valuing its bid of $2 cash and 1.5 Territory shares at $3.31 per ConsMin share. 

Territory is required to lodge its bidders statement by tomorrow night but is understood to have sought permission to postpone another fortnight to decide whether to sweeten its offer. 

JOHN PHACEAS


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## wintermute (28 August 2007)

I thought it rather amusing that Palinghurst released a new statement of substantial holding at the same time they extended their offer (for the second time), and that it had hardly changed at all from the initial 5% odd that I suspect they only managed to get because the market was in general panicking. 

I think they grossly underestimated the intelligence of CSM investors 

Tony.


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## bigtbigt (29 August 2007)

...so is it reasonable or legally permissible for Pallinghurst to offer $3.60 to CSM shareholders in Australia, whilst we UK shareholders have no option but to sell into the general market or vote yes and get just 3.30 ?


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## noirua (29 August 2007)

Rimtalay said:


> Noirua,
> Yes the price of nickel is now lower, BUT ConsMin was hedged for most of FY 07 at prices FAR less than the price of nickel now at US$12 spot price. They are no longer hedged. If you think that nickel is going down, then as I said before buy yourself a plane ticket to China. Take a trip around the country, like Chengdu, Kumming, Yichan, places analysts never talk about, and most likely have never been.
> Yes, the price of chrome ore is a LITTLE softer, BUT ConsMin's contracts last year DID NOT get much of these increases. In fact their prices for new contracts now are 25% higher than last year.
> Again, the softening is only a leveling off getting ready for another leg up. I 'm in contact with a manager of a chrome producer in the USA and he is very bullish on Chrome ore, ferro-chrome etc going forward.
> ...




Hi Rimtalay, I'm not a follower of Keith Goode and his website is only average.  I doubt he has that much insight into the goings on of the three bidders, prospective or otherwise.

Raising cash is going to be very difficult in these increasingly tricky markets. CSM have their own financing problems and need Pallinghurst to help them get the best out of their holdings. 

Chrome and nickel are highly priced at the moment and could soften further. I doubt the prices will tank, but who knows?


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## Aedo (29 August 2007)

bigtbigt said:


> ...so is it reasonable or legally permissible for Pallinghurst to offer $3.60 to CSM shareholders in Australia, whilst we UK shareholders have no option but to sell into the general market or vote yes and get just 3.30 ?



Having now made a new offer at $3.60 I believe Pallinghurst must now pay that as a minimum for _all_ future shares they buy through any offer.


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## noirua (30 August 2007)

Pallinghurst are probably standing in the market, offscreen, ready to mop up any stock at $3.60, until the end of trading today.

At the moment CSM are at $3.65 so Pallinghurst have no luck so far.


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## Aedo (31 August 2007)

Action day today!

TTY bid is in - firm at last offer of $2 plus 1.5 TTY shares per share.

Bidders statement available here (note: 6MB file).

There's more!   Palmary have made a cash offer of $3.95 per share.


No response yet from Pallinghurst.


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## Rimtalay (1 September 2007)

*NEW BIDDER *
*Have the Ukranians delivered the knock-out punch in Consmin manganese bid battle?*
Another day, another chapter in the battle for West Australian based miner Consolidated Minerals (ConsMin) but this time there is a view that the Ukrainian group Privatbank may have written if not the concluding then a very conclusive chapter. 

Author: Ross Louthean 
Posted:  Friday , 31 Aug 2007 

PERTH -  

Two days ago a clearer path was looking good for Brian Gilbertson's Pallinghurst group to win control of manganese-chromite and nickel miner Consolidated Minerals. However, its elevated bid of $A3.60/share gained virtually no market traction and then Norwegian ferro-alloys producer Tinfos entered the ring by paying $A3.65/share ($US3/share) to secure by yesterday a 4.8% stake, costing $A40 M ($US32.96 M).  Today it has been announced that through its Belize-based investment associate Palmary Enterprises, the Ukrainian Privatbank has lodged a bid for ConsMin at $A3.95/share ($US3.25/share). 

Media reports today after ConsMin announced Palmary had tossed its hat into the ring, said that Ukrainian group now had more than a 14% stake, making it the biggest single stakeholder in the company.

The other bidder, Northern Territory iron ore miner Territory Resources Ltd, run by former ConsMin chief executive Michael Kiernan, also put out its bidding document out (based on $A2/share and 1.5 Territory shares per ConsMin share) and it was valued at about $A3.45/share ($US2.84/share).

Kiernan said Territory would adopt a "wait and see" approach, having at least the 6% stake of ally Noble Group of Hong Kong in its court.

Alex Passmore, the head of metals and mining for Perth broking house Paterson Securities, told Mineweb he saw the Palmary bid as being the "knock out" punch.

*Passmore said it was interesting how ConsMin's value has lifted since its directors first warmed to the first bid by Gilbertson's group a few months ago at $A2.30/share ($US1.89) when the game was now at least $A1.65/share ($US1.35) greater. (Paterson Securities is one of the Australian broking houses that has been buying stock for Palmary).*

Privatbank has a major stake in the Nikopol manganese mine in the Ukraine which has been buying ConsMin's higher grade Woodie Woodie manganese ore in WA's Pilbara as a blend.

Passmore said there is a clear synergy for Privatbank/Palmary and that is ConsMin's Woodie Woodie mine and regional reserves and resources. It is not buying Woodie Woodie ore on an established contract, and Passmore said Nikopol has a thirst for more manganese.

At the close of trading today there were sales of ConsMin shares at $A4.07 ($US3.35) and buyers above $A4.


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## Lert (1 September 2007)

Well, I finally bailed yesterday at $4.06.. I'd held for 2 years since shortly before the boss sold 4 mil worth to build the missus a new house  I got out with my hide intact but learned a lot about stop losses along the way. Thanks to Rimtalay for the posts which helped me hang on through the low bits. Best of luck to those continuing to hold..


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## Rimtalay (2 September 2007)

Hi Lert, I am so pleased that many shareholders did OK. I can now tell you that there has been a lot of behind the scenes fighting with this takeover saga. I can tell you straight Rod Baxter, D Carter and David Brook have felt the wrath of the Consolidated Minerals Takeover VOTE NO  team since the offer came out on the 23rd Feb , we have battled constantly for months.
We have not stopped yet, and we are presently dealing with ASIC with the deliberate withholding of the manganese prices from the market for over 6 weeks. I hope that ASIC 'nail' Baxter and Carter to the wall. I won't give up till this is accomplished. 

*Palmary makes knockout bid for ConsMin
August 31, 2007 - 11:44AM*


Consolidated Minerals Ltd was on Friday considering a third takeover offer after a Ukrainian billionaire launched a potential knock-out bid for the base metals miner, valuing the target at more than $900 million.

Belize-based mining and investment company Palmary Enterprises Ltd is offering $3.95 cash per share for ConsMin, valuing it at $902.28 million.

The ConsMin board is considering the bid and will update its shareholders once its assessment is complete.

"In the meantime, ConsMin shareholders are urged to take no action," it said.

Palmary, which already has a 14.36 per cent stake in ConsMin, is controlled by Ukraine-based Gennadiy Bogolyubov, who is ranked 799 in Forbes's 2007 global list of 946 billionaires.

ConsMin shares soared 9.7 per cent or 36 cents to close at $4.07 on Friday, leaving it with a market value of $929.69 million.

Palmary's bid, which does not have a minimum acceptance level, follows a recommended bid by Pallinghurst Resources Ltd, led by former BHP Billiton Ltd chief Brian Gilbertson, and a bid by Territory Resources Ltd.

Pallinghurst on Thursday increased its offer for ConsMin by 30 cents a share to $3.60, valuing ConsMin at $822 million.

ConsMin's board recommended Pallinghurst's offer in the absence of a superior bid.

Territory's offer of $2 cash and 1.5 of its shares for every ConsMin share values ConsMin at about $782 million, based on Territory's closing price on Friday of 95 cents.

Pallinghurst's Johannesburg-based partner Arne Frandsen told AAP the group had not yet had the opportunity to review Palmary's offer.

"This arrived in the middle of the night, I read it before I went to bed a few hours ago and haven't yet discussed it with my colleagues," Mr Frandsen said.

"We will read the bidder's statement with great interest when it gets out and will formulate a strategy accordingly."

He would not be drawn on whether Pallinghurst would launch an improved offer in response to the Palmary bid.

Meanwhile, Territory on Friday released its bidder's statement, underlining its "wait and see" approach to the activity around ConsMin and saying that it reserved its right to vary its bid.

"We are dealing with a constantly changing landscape, which is yet to settle," Territory chairman Michael Kiernan said.

Mr Kiernan told AAP that the Palmary offer was no surprise.

"Palmary's bid was totally expected and that's why we put out our bidder's statement ... saying that the landscape had changed so much and was continuing to change, and we confirmed our offer, we didn't raise our offer," he said.

*Mr Kiernan said Territory had proposed to Ukrainian company Privat Group that ConsMin be taken private.

"A total cash offer (from Palmary) is not unexpected, firstly, and secondly, it's in line with a proposal I put to the Ukrains a couple of weeks ago, that (ConsMin) should be privatised and then Territory and Privat may enter into a joint venture to operate the manganese operation," he said.*

Privat owns steel, energy, chemical, banking and media assets in Russia, Ukraine, Romania and the United States, and partly owns the world's second largest ferro-alloy producer, Nikopol.

Palmary has expertise in manganese, with a 90 per cent interest in Ghana Manganese Co Ltd.

Territory shares fell two cents to close at 95 cents.


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## Rimtalay (3 September 2007)

*Dryblower sniffs around the latest ConsMin deal  *


Monday, 3 September 2007


SOME weeks ago Dryblower pleaded for someone, anyone, to put a pile of cash on the table and bring the sorry Consolidated Minerals takeover saga to an end. Well, now we have it in the form of a fistful of cold, Ukrainian hryvnia – and that should be the end of it.


Should be, but will it be?

Perhaps not. As Dryblower sees it, there are too many people with too much ego riding on ConsMin for the $902 million being offered in the all-cash bid from Ukraine's Privat Group to be the final word.

Some speculators agree because when trading stopped last Friday ConsMin was commanding a price of $4.07, having briefly touched $4.09, which was enticingly higher than Privat's $3.95.

Anyone paying more than a full cash bid for a stock must believe there's more to come. The question is who might that be - and who has already played their last card?

To help understand what might be going on, Dryblower thought it would be helpful to introduce a missing factor in everything written about ConsMin over the past few days – time.

In particular, there is a curiously logical sequence to the way in which announcements regarding ConsMin were made last week.

Consider the steps, using stock exchange release times – the time we officially knew something:



Tuesday, August 28, 6.27pm, Pallinghurst Resources says it has placed an order at $3.60 a share, making that the new price for ConsMin after almost a year of dithering with share swap alternatives.


*Friday, August 28, 9.16am, Territory Resources lodges its bidder's statement with a statement that it's not increasing its offer, preferring "a wait and see approach". 


Friday, August 28, 10.11am, Privat, via a subsidiary, Palmary Enterprises, lobs its offer of $3.95. *


Friday, August 28, 5.10pm, ConsMin says it is seeking further clarification from Palmary, and will advise shareholders shortly. 

Three points fascinate Dryblower.

First, there is the 55 minutes between Territory saying it is not increasing its offer, a sort of "running dead" statement as its $2 cash, plus 1.5 Territory shares per ConsMin share, as at Friday's closing Territory price of 95c a share, is valued at roughly $3.42 – which is less than Pallinghurst's $3.60, and much less than Palmary's $3.95.

Second, is this comment from Territory boss, Michael Kiernan, in his "wait and see" statement: "we are dealing with a constantly changing landscape which is yet to settle".

Third, was Kiernan's comments in the media after the Privat-Palmary offer was announced (55 minutes after Kiernan's "wait and see") that he would be happy to run the Woodie Woodie manganese mine for Privat, if asked.

There's a pattern here, and while Dryblower can't make out the whole picture it seems a range of interests have ganged up against Pallinghurst, and the ConsMin board, to deliver an outcome which goes something like this.


Privat, which is apparently a steel maker of substance with lots of cash, wins control of ConsMin.


Territory's offer of management services, if only for a short time, is accepted.


Noble Group, now there's a name we've all forgotten, retains its exclusive "life of mine" marketing arrangement for Woodie Woodie manganese.

It's that "life of mine" deal that Noble has on Woodie Woodie which fascinates Dryblower because it now dovetails so neatly into a future potential structure of Privat and Territory working together.

For Privat, a newcomer to Australia, a friendly arrangement with Territory and Noble represents a gentle introduction to Australian resources. No need to learn all the ropes, Kiernan and Noble boss, Richard Elman, can do it for them – the mining, the marketing and perhaps a few deals on other assets as well.

*And, what nicer way for Kiernan to show his good intentions than to "run dead" in the final leg of a takeover, to not increase the terms of his bid, leaving the way clear for Privat to do battle with Pallinghurst, something which it has enjoyed in the past.*

Is Dryblower seeing things in all this? Perhaps not!


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## Sultan of Swing (3 September 2007)

Thanks Rimtaly

Your posts have encoraged me to hold on. I'm still waiting to see what happens before I sell, if I sell.

The Dryblower post makes some interesting observations.

Cheers


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## weird (3 September 2007)

From a VSA (volume spread analysis) perspective, there is possible indication of selling pressure with high volume on the previous upbar. This could mean that it will drift sideways or down according to T/G. I don't recall seeing this signal, until today, so may be influenced by todays price action.

Be very interesting to see how things unfold.

I don't hold any position in CSM.


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## porkpie324 (4 September 2007)

Looking at the currant quotes on the buy side there's 600k @4.05, 300k @ 4.04, 300k@4.03, not so many on the sell side, average vol 3.5 mil daily with average vol for last 3 days 6 mil, so I'm holding on for now. BTW thanks Rimtalay for your excellant posts on CSM. porkpie


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## Rimtalay (4 September 2007)

Territory Resources has given up on it's bid for CSM. MK can now get back to TTY.

*Territory concedes loss over ConsMin*
 September 4, 2007 - 10:19AM


*Territory Resources Ltd has conceded that its fight for Consolidated Minerals Ltd is over and is banking on a potential joint venture with Ukrainian raider Palmary Enterprises.*
Nickel and manganese miner ConsMin on Monday backed a $902 million takeover bid from Palmary, which is controlled by Ukrainian billionaire Gennadiy Bogolyubov.

Palmary is offering $3.95 for each ConsMin share.

Territory chairman Michael Keirnan conceded its battle to take over ConsMin was more than likely over.

"ConsMin was one of several initiatives that we are looking at. Certainly it would have been a significant initiative, but it appears to have passed us by," Mr Kiernan told AAP.

Territory, which mines iron ore in the Northern Territory, was offering $2 cash and 1.5 shares for every ConsMin share, valuing the company at about $782 million.

The iron ore miner is now banking on a potential joint venture with Palmary - if that company's takeover succeeds - to manage and run ConsMin's lucrative manganese business in Western Australia.

Mr Kiernan said he had discussed the joint venture idea at a meeting with Palmary in Vienna last month.

"They said it was a good concept and to confirm it in writing, which I have now done," Mr Keirnan said.

"They have engaged UBS to look at it. UBS are advising them on the ConsMin exercise and we plan to touch base next week.

"At the end of the day, they are not interested in managing and running a manganese operation. They need groups or people to do that and that's what I put on the table."

Palmary's boss, Mr Bogolyubov, also is a backer of Ukrainian conglomerate Privat Group, which partly owns the world's second largest ferro-alloy producer, Nikopol.

ConsMin supplies manganese to Nikopol and Mr Kiernan said the motive behind Palmary's takeover move was to secure that supply.

"Without the ConsMin manganese, it affects their profitability significantly for the alloy smelter," Mr Kiernan said.

"Whether they pay 50 cents a share more is not a relevant factor. What is a relevant factor is they must have that manganese. They cannot allow anything to put that at threat."

There are two more players active in the takeover battle, a consortium led by Pallinghurst Resources and Norwegian ferro-alloys producer Tinfos, which is rumoured to be conducting due diligence on the target.

ConsMin originally had backed an $822 million or $3.60 per share bid from Pallinghurst before withdrawing its recommendation after the superior Palmary offer.

"I suspect the world has passed us by, both Pallinghurst and Territory," Mr Kiernan quipped.

ConsMin shares added one cent to $4.06 by 1257 AEST, while Territory put on one cent to 95 cents.


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## weird (4 September 2007)

Watching the order quantities within the Market Depth is pretty amazing with this stock ...


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## Rimtalay (5 September 2007)

*Solid assembly of suitors for ConsMin*
Malcolm Maiden
September 5, 2007

*THE takeover feeding frenzy over Consolidated Minerals is an example of the pervasive impact of Australia's commodity price boom. ConsMin is a fairly ordinary company with a variable profit history, but it controls one resource that in its own small way is making the boom possible, and there's a long line of people who want to own it.*
The Woodie Woodie manganese mine inland from Port Hedland is no Olympic Dam or Escondida. It is producing just under 1 million tonnes of high-grade manganese ore a year, and in the year to June 30, it boosted revenue by 12.2 per cent to $134.5 million, about half ConsMin's total revenue, which includes nickel and chromite. Annual global manganese production runs to about 30 million tonnes and high-grade production, including production from Woodie Woodie, is about 12 million tonnes, giving ConsMin about 8 per cent of the quality end of the market, which supplies high-grade blending stock to smelters.
Woodie Woodie is no 100-year asset, either. The resource is put at 15.4 million tonnes, and some of it is deep, and relatively high cost. But manganese is critical for the production of stainless steel and ferro alloys which, among other things, are used to make dry-cell batteries. As China's boom continues, the price of manganese is soaring, and transforming the economics of ConsMin's little mine.
The group barely covered its mining cash costs at Woodie Woodie in 2005-06 and 2006-07 after receiving average prices of $2.25 and $2.34 per dry metric tonne unit (DMTU) for manganese, down from $3.46 a year earlier when China was buying the metal and hoarding it. But continuing demand, the drawdown of Chinese stockpiles and bottlenecks in supply from other groups enabled it to strike prices around $6.60 per DMTU for last month, this month and next month.
Prices probably won't stay that high long term, but as Asia's industrialisation continues, they probably won't come back to $2 and change again, either.
Brian Gilbertson's Pallinghurst group started the ball rolling with a scheme of arrangement offer in February that valued ConsMin at $2.28 a share, but was overbid in July by Michael Kiernan's Territory Resources. Gilberston stayed in the hunt with a $3.30 cash offer, but after building up a stake of about 15 per cent in ConsMin, billionaire Ukrainian Gennadiy Bogolyubov's Palmary Enterprises swooped last week, with a $3.95-a-share cash bid. In all, ConsMin's share price has more than doubled since the action began, and it may not be over: Norway's Tinfos ferro-alloy group has built up a 5 per cent stake, and has been granted due diligence, and Kiernan, his bid overrun, is pursuing a tie-in with Bogolyubov.
It's fabulously clubby and convoluted: Bogolyubov's Privat group controls ferro-alloy smelters in Ukraine, Tinfos is in the same business, and Territory's bid was backed by Noble Group and DCMDecometal, commodities trading houses that sell ConsMin manganese in China and Europe respectively.
And nobody will get all of ConsMin unless the others bow out: Gilbertson controls 10 per cent of the group's shares and convertible bonds, Palmary has 15 per cent, Tinfos has 5 per cent and may go higher, and another 12 per cent is controlled by Noble and DCMDecometal.
mmaiden@theage.com.au
The Woodie Woodie manganese mine inland from Port Hedland is no Olympic Dam or Escondida. It is producing just under 1 million tonnes of high-grade manganese ore a year, and in the year to June 30, it boosted revenue by 12.2 per cent to $134.5 million, about half ConsMin's total revenue, which includes nickel and chromite. Annual global manganese production runs to about 30 million tonnes and high-grade production, including production from Woodie Woodie, is about 12 million tonnes, giving ConsMin about 8 per cent of the quality end of the market, which supplies high-grade blending stock to smelters.
Woodie Woodie is no 100-year asset, either. The resource is put at 15.4 million tonnes, and some of it is deep, and relatively high cost. But manganese is critical for the production of stainless steel and ferro alloys which, among other things, are used to make dry-cell batteries. As China's boom continues, the price of manganese is soaring, and transforming the economics of ConsMin's little mine.
The group barely covered its mining cash costs at Woodie Woodie in 2005-06 and 2006-07 after receiving average prices of $2.25 and $2.34 per dry metric tonne unit (DMTU) for manganese, down from $3.46 a year earlier when China was buying the metal and hoarding it. But continuing demand, the drawdown of Chinese stockpiles and bottlenecks in supply from other groups enabled it to strike prices around $6.60 per DMTU for last month, this month and next month.
Prices probably won't stay that high long term, but as Asia's industrialisation continues, they probably won't come back to $2 and change again, either.
Brian Gilbertson's Pallinghurst group started the ball rolling with a scheme of arrangement offer in February that valued ConsMin at $2.28 a share, but was overbid in July by Michael Kiernan's Territory Resources. Gilberston stayed in the hunt with a $3.30 cash offer, but after building up a stake of about 15 per cent in ConsMin, billionaire Ukrainian Gennadiy Bogolyubov's Palmary Enterprises swooped last week, with a $3.95-a-share cash bid. In all, ConsMin's share price has more than doubled since the action began, and it may not be over: Norway's Tinfos ferro-alloy group has built up a 5 per cent stake, and has been granted due diligence, and Kiernan, his bid overrun, is pursuing a tie-in with Bogolyubov.
It's fabulously clubby and convoluted: Bogolyubov's Privat group controls ferro-alloy smelters in Ukraine, Tinfos is in the same business, and Territory's bid was backed by Noble Group and DCMDecometal, commodities trading houses that sell ConsMin manganese in China and Europe respectively.
And nobody will get all of ConsMin unless the others bow out: Gilbertson controls 10 per cent of the group's shares and convertible bonds, Palmary has 15 per cent, Tinfos has 5 per cent and may go higher, and another 12 per cent is controlled by Noble and DCMDecometal.


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## Rimtalay (6 September 2007)

·                     the directors of CSM welcome the announcement by the Pallinghurst Consortium (Pallinghurst) that Pallinghurst has increased its all-cash off-market offer for CSM to $4.10 per CSM share (Revised Pallinghurst Offer) and unanimously recommend the Revised Pallinghurst Offer as being in the interests of CSM and its shareholders in the absence of a superior proposal;

·                     the directors of CSM withdraw their recommendation for the all-cash off-market takeover offer from Palmary Enterprises Limited (Palmary) of $3.95 for each CSM share (as described in Palmary's announcement dated 31 August 2007) (Palmary Offer); and

·                     the directors of CSM continue to recommend that CSM shareholders take no action in relation to the off-market takeover offer from Territory Resources Limited (Territory) of $2.00 cash plus 1.5 ordinary shares of Territory for every one CSM share (as described in Territory's Bidder's Statement dated 30 August 2007) (Territory Offer).


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## Rimtalay (6 September 2007)

*Pallinghurst Raises Bid for Consolidated, Tops Rivals (Update2) *

By Tan Hwee Ann and Madelene Pearson

*Sept. 6 (Bloomberg) -- Pallinghurst Resources Australia Ltd., chaired by Brian Gilbertson, raised its offer to acquire Australian manganese producer Consolidated Minerals Ltd. to A$937 million ($771 million), topping two rival offers. *

Pallinghurst will offer A$4.10 a share in cash for Perth- based Consolidated, the company said in a statement today. Palmary Enterprises Ltd. is offering A$3.95 in cash and Territory Resources Ltd. A$3.33 a share in cash and stock. 

Consolidated produces 10 percent of the world's high-grade manganese and prices for the material used in steelmaking more than doubled this year on demand from China. A five-year rally in commodities prices has led to a surge in takeovers in the mining industry. 

``They have got good assets, the sector has become very competitive and good assets are being snapped up,'' said Gavin Wendt, a resources analyst at Fat Prophets in Sydney. ``I don't think you'd rule out more bidding.'' 

Consolidated fell 2 cents, or 0.5 percent, to A$4.06 on the Australian Stock Exchange at the 4:10 p.m. trading close Sydney time. The statement came after the market closed. Territory shares, which have more than doubled this year, fell 2.8 percent to 88.5 Australian cents. 

The price of manganese delivered to China will reach a record in August to October, more than double average prices in the first half, Consolidated said Aug. 24. The board of Consolidated today recommended the Pallinghurst offer. 

Ukrainian Billionaire 

Pallinghurst, backed by closely held investor AMCI, also said it may match any rival cash offers made within the next three weeks, or pay shareholders the difference between the offers. Gilbertson was the former chief executive officer of BHP Billiton Ltd., the world's largest mining company. 

Its previous offer was A$3.60 a share in cash, and it was the first into the takeover fray announcing a cash and stock bid on Feb. 23. 

Palmary Enterprises is controlled by Ukrainian billionaire Gennadiy Bogolyubov. Bogolyubov has a net worth of $1.2 billion according to Forbes magazine's August 2007 list of world billionaires. 

Territory, led by former Consolidated Managing Director Michael Kiernan, is backed by trading companies Noble Group Ltd. and DCM Decometal International Trading GmbH. 

UBS AG is advising Palmary, Deutsche Bank AG is advising Pallinghurst. Lehman Brothers Holdings Inc. and Argonaut Ltd. are the advisers for Territory, and JPMorgan Chase & Co. is advising Consolidated. 

To contact the reporter on this story: Tan Hwee Ann in Melbourne at hatan@bloomberg.net ; Madelene Pearson in Melbourne on mpearson1@bloomberg.net


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## Sultan of Swing (7 September 2007)

Ok, there'll be a good explanation for this but I don't know what it is.

There's now an offer on the table of $4.10, it's 10:30 am but no shares have been traded and I don't know why there'd be a trading halt.

Why no trades yet?

Cheers


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## Sultan of Swing (7 September 2007)

Ok, it's now $4.27 off a high of $4.30. I still don't understand why no trades before 11am.

Can someone enlighten me?


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## Rimtalay (7 September 2007)

*ConsMin shares higher as suitors battle*
September 7, 2007 - 6:54PM

Shares in Consolidated Minerals rose by more than six per cent as investors anticipated a further chapter in a two-way tussle between Pallinghurst Resources Ltd and Palmary Enterprise Ltd to take over the manganese miner.

Suitor Palmary was considering its next move after its recommended offer for the manganese miner was trumped by Pallinghurst on Thursday.

Pallinghurst raised its bid for ConsMin to $4.10 a share, from $3.60, valuing the target at $936.7 million.

The offer was unanimously recommended by ConsMin's board after it bettered the Belize-based Palmary's bid of $3.95 per share, or $902.4 million.

But sources close to Palmary suggested Pallinghurst's latest offer may not be the last competitive bid for ConsMin.

"Shareholders should not accept Pallinghurst's offer if they want to keep the prospect of an auction alive," the source said.

"Sophisticated shareholders understand this and are unlikely to accept Pallinghurst's offer.

"Shareholders should wait for Palmary to indicate its position.

"Palmary is considering its position."

Palmary is controlled by Ukrainian billionaire Gennadiy Bogolyubov, a backer of conglomerate Privat Group, which partly owns the world's second largest ferro-alloy producer, Nikopol.

ConsMin shares rose 6.16 per cent, or 25 cents to $4.31, valuing the target at $984.69 million, which is above Pallinghurst's proposal.

A third potential suitor, Territory Resources Ltd, conceded defeat this week.

But Territory hopes that if Palmary is successful it could enter into a joint venture to operate the manganese operation.

Meanwhile, a fourth party, Norwegian ferro-alloys producer Tinfos, is rumoured to be conducting due diligence on ConsMin.

ConsMin's cash cow is the Woodie Woodie manganese operation in WA's Pilbara region.

Shares in Territory closed up three cents at 91.5 cents.


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## gs07 (8 September 2007)

*Pallinghurst takes the 'Aussie Axe' to rival bid*
Kevin Andrusiak | September 08, 2007

PALLINGHURST Resources has dubbed its innovative new offer for control of Perth-based carbon steels miner Consolidated Minerals the "Aussie Axe".

It is seeking to put an end to the race for the company that is likely to be the last high-grade manganese asset to be put up for sale anywhere in the world. The bidders all have lower grade manganese assets elsewhere that need to be upgraded to be well suited for carbon steel.

It is believed that Ukrainian counter-bidder for ConsMin, Palmary, is fuming at Pallinghurst's new offer, which, in what could be a world first, is devised to match cent-for-cent any revised bid by Palmary on an ongoing basis every time Pallinghurst extends its offer.

Pallinghurst has also determined that shareholders would receive top-up payments if another, all-cash bid, emerges before December.

The offer, which has again won the favour of the ConsMin board, is pitched at $4.10 a share and is a near 50 per cent improvement in total terms than Pallinghurst's first scheme-of-arrangement terms which kicked off the

ConsMin auction process in February.

The innovative scheme, designed locally by Deutsche Bank corporate financiers Alex Cartel and Tim Elliot, is also a boon for hedge funds which poured into ConsMin stock yesterday pushing the ConsMin share price 6.2 per cent higher to $4.31 by the close of trade.

However, Palmary is believed to be chasing regulatory intervention with claims that the scheme kills the auction process.

It is just another strange twist to the battle for ConsMin, which has been both bitter and controversial, caused significant corporate credibility damage to Australian under-bidder Territory Resources, and has come to highlight the determination of international resources heavyweights to win control of key Australian assets to take advantage of the global resources boom.

ConsMin's prime asset is the Woodie Woodie manganese mine in northwest Western Australia, which supplies about 10 per cent of the seaborne manganese trade.

The rest is controlled by BHP Billiton, Brazilian giant CVRD, French outfit Aeromet and Palmary.

Palmary -- which is addressed in Belize, based in Ukraine and falls under the broader Privatbank -- beat Pallinghurst to win the Ghana Manganese asset earlier this year and secure its own high-grade manganese supply.

The Aussie Axe scheme virtually ensures shareholders have to choose whether Pallinghurst boss Brian Gilbertson or Palmary founders, the reclusive Gennadiy Bogolyubov and Igor Kolomoysky, have the better deal-making skills to grow the ConsMin business.

Palmary seemingly has the upper hand with its control of Ghana Manganese, but Mr Gilbertson has promised to use ConsMin as the base to build a new business into a $10 billion miner of note.

There is strong speculation that Pallinghurst has now secured control of a South African manganese mine with an expected 80-year mine life.

Details of the asset are sketchy with Pallinghurst director Arne Frandsen declining to reveal further details, but all would be revealed should his company win the race for ConsMin.

It is a good bet that Pallinghurst will also use its links with backer AMCI to feed in some of its coal assets in Australia into the new business.

Yet mystery surrounds the intention of Palmary and its media-shy owners -- it has been hard to get any information on them since it launched its bid the previous Friday.

Sources close to the company yesterday claimed sophisticated investors would see through the Aussie Axe.

"Palmary is considering its position," the source said.


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## Rimtalay (9 September 2007)

*The Bidding For Consolidated Minerals Descends Into Farce*


By Our Man In Oz



*Seven months ago the directors of Consolidated Minerals were convinced that the company they run was worth roughly A$2.30 a share, and they recommended a partial takeover bid pitched at that price. Today, the same people believe the company is worth A$4.10 a share and they now recommend that price. Tomorrow, who knows, because on the market ConsMin is trading at A$4.30, 4.8 per cent more than what the directors currently recommend and 87 per cent more than the original deal proposed in February by Pallinghurst Resources, a business run by South African deal-maker, Brian Gilbertson.*
There are many questions to be asked of everyone involved in the ConsMin saga. So far, no-one seems to have asked the directors what they really *(truly, cross-your-heart)* reckon their business is worth, or why Gilbertson conceived a merger so complex that it required a 400-page explanatory memorandum, mailed to thousands of shareholders, and now used to press flowers.

To be fair, ConsMin is at the centre of a bidding war with large egos, armed with larger cheque books, tossing cash around as if it were confetti, leading to a corollary question on value: has the price of ConsMin now entered cloud cuckoo land, or is this simply the sharp end of the boom as cash-rich buyers battle for scarce assets?

*The answer to the first question about whether the directors know what their company is worth has to be that the poor darlings haven’t a clue. *The answer to the second question is that the battle for ConsMin has undoubtedly taken on all the finesse of a rugby scrum, on a sticky pitch, during a thunderstorm. It really is a case of the winner being the biggest and ugliest brute left standing, and not really caring about the prize, or that the prize might well be a wooden spoon.

To understand the ConsMin fiasco it’s best not to call it that. Patient shareholders of the small Australian manganese, chromite and nickel miner are doing very nicely as they enjoy a ride as wild as anything since the days of the Poseidon nickel boom when everyone left their brains at the door of the now defunct Perth Stock Exchange. With ConsMin the game started on the day Michael Kiernan saved it from oblivion after - and remember this-  after the Woodie Woodie manganese mine effectively failed, sending its then owner, Valiant Consolidated, almost to the knackers yard.

The historic troubles of Woodie Woodie, a mine worked intermittently for more than 50 years,  depending on the price of manganese, have been as conveniently forgotten today as the popped Poseidon bubble. Perhaps this really is a boom forever (note to editor: that was typed with fingers crossed!). On a more serious note what is happening with ConsMin does no-one any credit. Yes, it’s making money for the players involved, but there is an unmistakable odour of boom-time excess wafting off the stock.

Consider the facts. Talk of a takeover/merger between ConsMin and Pallinghurst first surfaced in October last year. A formal merger proposal was delivered on February 23. The four month gap between the referee blowing the whistle and ball actually being kicked should have rung a warning bell. There should also have been warning bells ringing about Kiernan’s desire to get back on the field and repay a few courtesies dished out by some ConsMin directors as he was departing. And, there should have been a warning about the background role of Richard Elman, chief executive of the commodities trading business, Noble Group, a supporter of Kiernan, and the man holding a “life of mine” marketing contract over Woodie Woodie.

In any event, Kiernan counter bid via one of his new companies. Gilbertson countered. Kiernan countered the counter. Then a heavy duty Ukrainian steel maker, Gennadiy Bogulyubov, entered the game, and finally a Norwegian alloy specialist, Tinfos, weighed in. At the last count, Tinfos had 5 per cent of ConsMin, Bogulyubov 14.36 per cent (through a company called Palmary), and Pallinghurst 10 per cent. Kiernan had very little, and appears to have backed away from the bidding.

This final point about Kiernan appearing to “run dead” by not increasing his cash and share swap offer is critical to what’s afoot because no-one, and that includes the board and management of ConsMin, knows Woodie Woodie as well as he does. Unlike the chaps in slick suits, he once lived in a converted bus at the mine gate acting as truck tally man. It was his intimate knowledge, and extreme annoyance at not being paid by Valiant, which led him into his first deal with Elman. The nature of that deal was that Elman finished up with ownership of the mine, hence today’s life of mine contract, but he needed someone to run it. Between them, Elman and Kiernan make an excellent pair of blunt instruments – but they are far from being stupid blunt instruments, and they also know exactly what an asset is worth.

Which takes us back to the top, and the critical questions - what’s ConsMin worth? The market, which is always right, says A$4.30. Gilbertson says A$4.10 , but with a clever rider on his offer that he will match any rival bid, and he’s ready to pay now, effectively a “top up” facility to encourage quick acceptances. That puts the ball on Bogulyubov’s side of the pitch, and it needs to act quickly, or Gilbertson steals the day.

But, even if Gilbertson wins what is  it that he’s actually won? For a price, presumably north of A$4.10 once the mud settles, he gets a pre-loved manganese mine which is suddenly being praised as one of the best in the world. Well, 10 years ago, and even 50 years ago, it certainly wasn’t one of the best. Yes, the manganese price has risen,  but it has been known to fall just as often, and this is a company which, seven months ago, was valued at A$2.30 by the people who run it, and a company which was once run by a man who is now not interested.

Poseidon time? Jolly close!


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## wintermute (9 September 2007)

Hi Rimtalay, what do you make of that last article you posted??  I think it is a Little over-simplistic (basically saying that because keirnan appears to have pulled out of the race that the manganese side of the company is now overvalued).   Sure Keirnan may know it better than others, but knowing the value of something, and being able to afford it are two different things, and I think the author is making a pretty big leap to come to the conclusion he has.  It is not just the manganese but also the nickel and chromite, and let's not forget the iron ore as well. 

I don't think that this is anything like poseidon, and for the author to even mention it to me rings alarm bells, and makes me question the motives... time will tell I guess  

Still holding here, but must admit it is tempting to sell some!  Will be interesting to see what happens Monday after the selloff on friday in the states...  CSM is my best performing share of late, everything else is in the dog house!!

Tony.


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## Rimtalay (9 September 2007)

ConsMin at $4.30 is at full value, whilst it may go higher with the bidding, I would be looking to exit. Too many other good cheap stocks at present with more upside. Now is the time to move on, before other good stocks increase, and an opportunity lost. The easy pickings with ConsMin is now over, I'd take the money and run. 
The story on the minesite.com http://www.minesite.com/nc/minews/s...solidated-minerals-descends-into-farce/1.html

is close to the mark. I doubt whether there is much upside now. I'll be following MK into TTY, it's taken a battering over this, lots of CSM shareholders have also jumped ship into Territory Resources, it also has the backing of Noble Group, and they are no fools.  Sell on market, let the hedge funds have their fun.


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## wintermute (10 September 2007)

Thanks Rimtalay.  I'm tempted to sell some, but I'm going to hold out for now.  I guess taking profits now does give a certainty, as CSM continuing at this price level is largely dependent on prevailing metals prices... if they come down again so will the sp, but if they continue on at current levels for a few years to come, then I would say there would be potential further upside. 

if we hit $4.50 I might reconsider  

Tony.


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## sammy_k2000 (11 September 2007)

With a forecast EPS of 50cents for at least the next two years who ever end up with CSM as around the $4 mark is buying an extrememly cheap comapny with a P/E of only around 8 at this point.  In my mind when I first looked at this stock at around the $2 mark I certainly saw a fallen angel and I am sure that those bidding can see the other upsides.  It might also be interesting if you look into the other highlights that this company has such as Jabiru and also a joint venture with YML which may a remind has gone from 13cents to 90 cents in a matter of weeks due to its sucess.  To my way of thinking this company certainly has a hell of a lot more to offer and through no favours from our directors though as the only thing they seem focussed on is keeping their jobs.  All I can say to everyone is hold on who knows if Tinfos comes into the picture $5 isn't unreasonable.


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## wintermute (11 September 2007)

I did some calculations a while back and came up with even higher eps figures, but nickel has dropped below my estimated price.  Certainly I think that 50cps earnings is a possibility, but it does rely on costs staying constant and metals also staying constant (or going up). 

One thing that I am wondering about is the fact that the original palinghurst bid had a break fee of $5,000,000  and the directors did break when they recommended Palmary... did that 5 Mill go to palinghurst, or have they waved that and that is the reason that the new recommendation has a break fee of $10,000,000!!!!!  

if this keeps up the break fee will make palinghurst the only viable alternative  I'm rather appaled that there is a break fee in the first place, that has been decided without any shareholder say so.... it's not like the directors couldn't just say NO... you buy it if you can, but that's it!!!

Tony.


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## hubisan (12 September 2007)

*Consmin worth significantly more than 4.10 AU$ IMO*

First : my thanks to Glenn for his work to substantiate the real value of Consmin by informing about all the important informations

For the moment I have seen no explanation of how the bidders value CSM
end also estimations in this thread are already old with respect to manganese price

We now have come to a point were cash bidders really confront shareholders and want to take Consmin.
We therefore must make an update of the estimated  valuation of Consmin.
As I do not feel as best qualified to do that, I recollect qualitatively the most significant areas:

* nickel production increase in coming semesters (a result of a long investment process about to be fruitful)
* nickel price increase in past year
* end of nickel price hedging
* very significant price rise in manganese
* strong increase in valuation of participations
each of these items are in the range of one or several 100 MAu$ potential increase of valuation with respect to the situation of last year.
Maybe less significant but positive : the increase in chromite price


I still do not agree that a 4.10 Au$ is a fair value. even considereing that a fair value must leave value for the buyer.

Just another fact :since 24th july Au$ went down from 0.88 US$ to 0.82 US$. Which results in two things:
1/ the cash cost in AU$ is a lower fraction of FOB US$ price (EBITDA increase)
2/ the price for the buyer is down 6% wrt future US$ value of metal reserves

I also mention that consmin traded at 4 Au$ just 2 years ago with much less upside than now on all the items I mentioned above.

I keep my shares and let the 4.10 offer pass.
We need an updated valuation of consmin.

Hubisan


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## Rimtalay (13 September 2007)

Why no announcement yet? The news was posted as an announcement in the UK but not in Australia. WHY?
ConsMin management are hoping that shareholders will accept the Pallinghurst bid before making the announcement. ConsMin management still trying to rip off shareholders.

12-09-07 Consolidated Mineral - Increased Offer by Palmary RNS 
RNS Number:7475D Consolidated Minerals Limited 12 September 2007

Consolidated Minerals Limited - Revised Offer from Palmary

Consolidated Minerals Limited (ASX: CSM, AIM: CNM, FSE: CMN) advises that it has today received from Palmary Enterprises Limited (Palmary) the attached announcement relating to a proposed increase to $4.50 per CSM share of its cash takeover offer for all of the issued shares in CSM.

The Board of Consolidated Minerals will consider the terms of the proposed offer by Palmary and will provide guidance to shareholders as soon as it has completed its assessment of the offer. In the meantime, CSM shareholders are urged to take no action.

Paste the following link into your web browser to download the PDF document related to this announcement:

http://www.rns-pdf.londonstockexchange.com/rns/7475d_1-2007-9-12.pdf

John Abbott Company Secretary Consolidated Minerals Limited

The Company's nominated adviser is RFC Corporate Finance Ltd 

contact Stephen Allen +61 8 9480 2507.

This information is provided by RNS
The company news service from the London Stock Exchange


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## Rimtalay (13 September 2007)

Palmary Raises Consolidated Bid, Trumps Pallinghurst (Update3) 

By Brett Foley

Sept. 12 (Bloomberg) -- Palmary Enterprises Ltd., controlled by Ukraine's Gennadiy Bogolyubov, will raise its cash bid for Australian manganese producer Consolidated Minerals Ltd. to A$1.03 billion ($859 million), trumping a rival offer. 

Palmary's offer of A$4.50 a share would be 14 percent higher than its bid on Aug. 31 and above Pallinghurst Resources Australia Ltd.'s revised bid of A$4.10 made Sept. 6. The offer will go ahead if Perth-based Consolidated recommends it by noon Melbourne time tomorrow, Palmary said today in an e-mailed statement. 

Pallinghurst's offer ``is uncompetitive, unfair and gives an unfair value proposition'' to investors, Palmary President Bogolyubov said in the statement. Consolidated, in a separate statement, urged shareholders to take no action for now. 

The bidders are seeking control of Consolidated to get access to a 10th of the world's high-grade manganese, used in steelmaking. A construction boom in China is fueling demand. 

On Sept. 10, Consolidated recommended investors accept a A$937 million offer from Pallinghurst, a fund led by former BHP Billiton Ltd. Chief Executive Officer Brian Gilbertson. Pallinghurst said it may match any rival cash bids made in the next three weeks, or pay shareholders the difference between the offers. Palmary is Consolidated's largest holder with 14 percent. 

Consolidated gained 10.5 pence, or 6.2 percent, to 179 pence in London. The shares, which have more than doubled this year, closed up 2.5 percent at A$4.50 in Australia before Palmary's announcement. 

Three Increases 

Pallinghurst, which has increased its bid three times, denied the offer was unfair and said it had been supported by investors, company director Arne Frandsen said today in a telephone interview from Johannesburg. 

``Our offer remains unconditional and the top-up mechanism ensures investors will get the best price,'' Frandsen said. 

Perth-based Territory Resources Ltd., backed by trading companies Noble Group Ltd. and DCM Decometal International Trading GmbH., has also made a cash and stock offer. Consolidated said Sept. 10 it hadn't received any indication on the intentions of a potential fourth bidder that made an incomplete approach on Aug. 20. 

The value of Palmary's increased offer is based on the 228.3 million common shares of Consolidated that according to the company's Web site were issued as of Aug. 15. 

To contact the reporter on this story


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## hubisan (20 September 2007)

*Do not forget to add capital gain tax as part of price structure*

A shareholder of consmin is partner of a business with very positive future.

By forcing me to exit now, this takeover creates for me a French investor,  a massive capital gain, taxed at 27%.  Considering a capital gain of 60% of sell price my tax will be 16% of price. 

If I could hold Consmin for several years this tax would not exist on long term capital gain and I would in addition benefit from future growth and dividends.

It is possible that many investors also have to pay a penalty tax on gains if they agree to sell.

I definitely believe that consmin is a good investment and that the bider must compensate me for the tax cost that it creates when he forces me to exit.

Everybody should think about the tax consequence of the takeover and really account for all aspects of his selling.

Now what should be the price of consmin

Again valuation of a mine is a difficult task.

I simply notice that 2 years ago consmin was already valued at 4 Au$ but since that the price of metals have exploded.
I want to get a part of that value above 4 Au$. 
Let's say for the sake of discussion that I want a very small and unfair 10%
And I don't want to losoe because of tax.

Then the sell price must be about 4.0 * 1.1 / (1-0.16) = 5.24 Au$
This is the lowest unfair price I should consider in order to ge a small part of the future value of recent upward  trend in metal prices.

Again the price is not high enough.
And this is not based on assessment of consmin potential that is still to be done.

For the moment IMO the price has to go up again.
The bid process of Palmary will take a few weeks so...  I just wait

Hubisan


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## kerosam (20 September 2007)

fellows, has pallinghurst withdraw the bid? they are demanding the break fee! by the way, is it a common practice for a company to compensate an unsuccessful take over?

http://www.asx.com.au/asx/research/...panyName=&principalActivity=&industryGroup=NO


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## Sainter (20 September 2007)

Break fees are not new. Pallinghurts(!) has maybe set themselves up for 2 bites of the cherry-they might take this $ and then demand another break fee if they were to put in another offer. Wouldn't surprise me. Asking for the break fee also sent the market briefly back to $4.55 or so-maybe they were hoping it would be more permanent, and they'd be able to then lob a bid for $4.80 or so??
Let's see how the it goes overnight. 
Cheers!


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## sheggie (21 September 2007)

I'd love to know what the thinking behind these break fees is. And is there a break fee involved with the new bid?


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## hubisan (22 September 2007)

*Break fees, what 's the rationale ?*

What is the rationale?
To what extend or in which case is that in favor of shareholders?
If not, what legacy has the board to agree to repeated break fees?
Seems strange to me.

Somebody to decode that ?

Hubisan


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## wintermute (22 September 2007)

My view is that if the board is acting in the interests of shareholders they should simply say "if you want to buy the company then do so on market"  stick the break fees where they fit  but then I'm probably not a savvy business man  

I'm holding on for now as I bought a bit over half of my shares about 11 months ago, so holding out for the cgt discount to kick in, then I'll sell about 1/2 to be in a free carried (not taking the remaining tax into account) position. 

The thing that still amazes me is that CSM felt that selling out at $2.28 per share was in the best interest of shareholders!! 

To answer someone elses question, yes the palmary offer has a break fee too, I think from memory it is 1% of the market cap of the company.  So depending on how high the bidding gets there break fee gets bigger too!  I'm hoping that CSM management is not so stupid as to keep tooing and frowing between different bidders and paying escalating break fees each time they do!

Tony.


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## sheggie (29 September 2007)

I've sold half my shares at $5. I notice Palmary's  'change of substantial holding' notice. They've sold some too. Now it's down to $4.91. 
CSM says there's another bidder out there (apart from Territory) who hasn't shown their hand yet.
Maybe Pallinghurst will still win this game, what do you think?


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## hubisan (15 October 2007)

*Pallinghurst is ridiculous*

I am fedup with Pallinghurst
I clearly dislike them

Their original sin, trying to rob shareholders at 2.28 a share should not be forgotten nor forgiven. Let me remind that they wanted to pay 2.28 dollars for the controlling block of 60% and they did not offer 2.28 for 100% of the shares. We were left with 40%of our shares as minority holders. Everyone knows that a controlling share is worth more than a minority share so that in effect the initial proposal was worth less than 2.28.
THe discount on value of a minority share is big when the majority holder is unfair. With Pallinghurst, from what I have seen I consider them as unfair.  their first offer wanted to take control to do whatever they want with assets.   A discount of 33% for minority shares would have been adequate. In effect their proposal was something like 
(2.28*3+2.28*0.67*2)/5= 1.98 Au$
The share was recently quoted at 5 Au$ and above. You see the difference.

What Pallinghurst also did :
Bribing of Consmin management
Paying PriceWaterhouseCooper to value consmin at 2.28
TRying to Get paid Breaks fees with our money
Paying brokers to talk us into  approval to sell.
They are pure manipulators from beginning to the end.
They try to pay anybody before trying to pay a fair price to the shareholders.

ONe thing I can tell is that Pallinghurst will clearly have to pay a clear premium with respect to others if they want my shares.
And I will wait until the last minute.

And I will also consider keeping my shares until next year.

I do not see any winner ( in my view a winner is somebody with more than 50%) coming out of that game.

If nobody gets close to 50%  I will very well keep my shares at least until next year. It would be so much tax to sell this year that I can wait. 

I like consmin business and I like the trend and upsides of consmin.
nickel upside in increased production, dehedging, and exploration
iron upside in price 
manganese upside in price and exploration
chromite upside in price and exploration

And I don't mind if consmin gets back to 4 if the takeover fails.

I am ready to bet that within one year from now it will be worth more than 5
And for the moment I see no urgency in paying taxes to please Mr Pallinghurst of Mr Palmary.

At least from what I have seen with Pallinghurst if they offer 4.5 it means it is worth much more.
And you know what : the good thing is, I do not see any reason why an independant Consmin would not be able to unlock that value taht Pallinghurst  sees. My position is that the benefits of being with bigger interest is close to bull****.

Consmin would do very well simply by implementing its business plan in nickel with a growth of 50% of the production

Hubisan


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## Rimtalay (16 October 2007)

*Now the truth is starting to come out about the cosy deal done by our dear chairman D Carter and Gilbo.*
http://www.moneyweb.co.za/mw/view/mw/en/page55?oid=165760&sn=Detail

BRIAN GILBERTSON: Well, it's clearly the end-game of a fairly long, drawn-out process. You know, I met with the chairman of the company, Dick Carter, pretty much on a year ago. *We met in Dubai and we agreed what we wanted to do.* Now since then, quite a lot of water has flowed under the bridge. We've had Australians bidding for it, we've had a Norwegian company getting involved in it, then we had the Ukrainian group coming in. The Ukrainian bid is, as you know, at $4.50, and we've been wondering the best way to bring this to a sound, the right outcome. And you correctly pointed out that today, this morning South African time, we tabled a bid which matched their offer. But the important part of this is that we've used a mechanism called a "top-up" offer, the internal phrase we use is the "Aussie axe", because it forces people to come to a conclusion on it, and we have undertaken that if Palmary comes back with a higher offer, we will match it.


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## Rimtalay (18 October 2007)

*UKRAINIAN billionaire Gennadiy Bogolyubov plans to keep the same chooks in the henhouse. Pity, I thought he'd be smart enough to give Carter and Baxter the boot.*

http://www.theaustralian.news.com.au/story/0,25197,22604282-5005200,00.html

*"Palmary says if it wins control of ConsMin it plans to implement the miner's strategy to diversify and expand the business, and it plans to retain the current management team, including managing director Rodney Baxter." *

TOU violation


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## Aedo (18 October 2007)

While not necessarily impressed with DC, RB and Co - a share price of $5 from $2 earlier in the year looks better than most!:








Despite the route taken


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## Rimtalay (18 October 2007)

Aedo.
I would like to point out, if it was left to the ConsMin management then all you would get is $2.28/share as originally offered by "I'm the premium Gilbertson".
You can thank the *Consolidated Minerals takeover Vote No team *and *Michael Kiernan *for the increase in the share price. 
I can assure you Baxter and Carter had nothing to do with it.
 I have *many*  emails from Baxter who says that he doesn't want to excite the market with exploration successes and manganese price rises.
In fact the Vote NO team had to contact the ASX and ASIC to get these price rises out into the market place ( 6 weeks after the Mn increases and more than 140% did our dear CEO Baxter decide that it was necessary to inform the market, I can assure you there was  a lot of pressure applied).
One day it will all come out!!!


Everyone has very short memories.


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## Aedo (19 October 2007)

Rimtalay said:


> Aedo.
> I would like to point out, if it was left to the ConsMin management then all you would get is $2.28/share as originally offered by "I'm the premium Gilbertson".
> You can thank the *Consolidated Minerals takeover Vote No team *and *Michael Kiernan *for the increase in the share price.
> I can assure you Baxter and Carter had nothing to do with it.
> ...



Rimtalay,

Thanks for your response to my light hearted post.   That was an excellent summary - particularly the comment "I can assure you Baxter and Carter had nothing to do with it"!

And no short memory here - I am well aware of both the "vote no" group and MK and have watched the saga very closely (including reading that stupid 400+ page document) over the last 8 months or so. I am _extremely_ impressed that the share price has hit $5 (and a little amazed it has to be said).

Again, your work _is_ appreciated!


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## Rimtalay (24 October 2007)

Looks like another buyer of ConsMin more than 40 million shares or 17.7% of CSM , held in a bank in Prague.
Buying on market, looks like some smart operator who is building a stake. Maybe the next offer is $5 or more.


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## Rimtalay (24 October 2007)

*HOLD*, another bid is coming.

Mystery buyer has huge slice of ConsMin
October 24, 2007 - 7:39PM


*The one billion dollar plus battle for control of Consolidated Minerals Ltd (ConsMin or CSM) has taken a new twist.

A mystery buyer emerged on Wednesday with almost 18 per cent of the target, making the investor the emerging miner's biggest shareholder and able to block existing takeover bids by rival suitors Palmary Enterprise Ltd or Pallingurst Resources Australia Ltd.*
ConsMin told the Australian stock exchange after the end of trading that it had "become aware of a holding of 40.6 million ordinary shares in CSM (constituting 17.7 per cent interest in the total issued capital of CSM) registered in the mane of ANZ Nominees Ltd".

"Despite repeated attempts, through the issue of tracing notices pursuant to the Corporations Act, CSM has to date been unable to ascertain the identity (or identities) of the ultimate beneficial owner (or owners of this interest," ConsMin said in a statement to the exchange.

"What has been ascertained is that the ultimate beneficial owner (or owners) have used at least four different custodians in Australia and continental Europe. The response to the most recent trading notice issued by CSM indicated that the shareholding is held by Euroclear Bank for ING Bank in Prague."

The one billion dollar plus battle for control of Consolidated Minerals Ltd (ConsMin or CSM) has taken a new twist.

A mystery buyer emerged on Wednesday with almost 18 per cent of the target, making the investor the emerging miner's biggest shareholder and able to block existing takeover bids by rival suitors Palmary Enterprise Ltd or Pallingurst Resources Australia Ltd.

ConsMin told the Australian stock exchange after the end of trading that it had "become aware of a holding of 40.6 million ordinary shares in CSM (constituting 17.7 per cent interest in the total issued capital of CSM) registered in the mane of ANZ Nominees Ltd".

"Despite repeated attempts, through the issue of tracing notices pursuant to the Corporations Act, CSM has to date been unable to ascertain the identity (or identities) of the ultimate beneficial owner (or owners of this interest," ConsMin said in a statement to the exchange.

"What has been ascertained is that the ultimate beneficial owner (or owners) have used at least four different custodians in Australia and continental Europe. The response to the most recent trading notice issued by CSM indicated that the shareholding is held by Euroclear Bank for ING Bank in Prague."

CSM said that it had not received any substantial shareholder notice from any party or parties in relation to the holding.

"In light of the size of this shareholding and the fact that CSM is already the subject of competing takeover proposals from Pallinghurst and Palmary Enterprises (each of which has been the subject of previous announcements to the market), CSM wishes to identify the beneficial holder (or holders) of this shareholding as a matter of urgency.

"To this end, and in light of the fact that CSM's efforts to identify the ultimate holder through tracing notices has not yet been successful, CSM has referred the matter to ASIC (Australian Companies and Securities Commission) for further investigation and action."

CSM said that it reserved the right to pursue action through the Takeovers Panel and would keep the market informed of further developments.

Until Wednesday, Palmary was ConsMin's largest shareholder with a 14 per cent stake, and is seeking a shareholding in ConsMin of more than 50 per cent, but less than 90 per cent.

The ConsMin board has spent much of last week reviewing the competing offers and said in a statement on October 19 that it would retain its recommendation for Palmary's bid in the absence of a superior offer.

The board said Pallinghurst was unable to increase the cash component of its offer in the absence of Palmary or any third party making a higher offer prior to the close of Pallinghurst's offer on November 2.

Palmary has made an unconditional cash offer, the key difference between rival Pallinghurst as both have offered $4.50 per share, valuing the target at $1.03 billion.

Palmary applied to the Takeovers Panel last week regarding a statement made by Pallinghurst earlier in the month.

The Takeovers Panel has decided to commence proceedings and on Tuesday issued interim orders requiring Pallinghurst to extend its offer to November 2.

 © 2007 AAP


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## Rimtalay (25 October 2007)

October 24, 2007

*The Great ConsMin Mystery Inside A Puzzle*


By Our Man In Oz



*It might turn out to be a case of European bank privacy bumping into Australian corporate law, but to the casual observer a surprise stock exchange filing earlier today by the takeover target, Consolidated Minerals, smacks of “dirty tricks”. According to ConsMin, which is the recipient of a series of takeover bids, it has “discovered” a mystery investor on its share register with title to a parcel of 40.6 million shares valued at a handsome A$190 million. That stake, which converts into a 17.7 per cent interest in ConsMin, is said to be registered in the name of “Euroclear Bank for ING Bank in Prague”. And that’s about as far as ConsMin’s inquiries have got, and why it’s blown the whistle and called in the corporate cops.*
According to ConsMin it has been using the Australian Corporations Act to try and identify the owner (or owners) of the parcel. But after peeling away four layers of custodians in Australia and Europe the carefully constructed puzzle remains in place. If ConsMin was not the subject of competing takeover bids from high-profile investors this would not be such an important event. Investors, especially fat cat Europeans who crave privacy, routinely mask their intentions behind a corporate veil to rival Winston Churchill’s famous description of Russia being “a riddle wrapped in a mystery inside an enigma”.

ConsMin, however, is not a normal company. It has received steadily rising bids from Pallinghurst Resources, a private equity fund managed by one-time BHP Billiton boss, Brian Gilbertson, and a purpose-designed company called Palmary Group which ultimately reports to Ukrainian billionaire, Gennadiy Bogolyubov. At the last count, and only after regular court challenges and appeals to the Australian Takeovers Panel, Gilbertson and Bogolyubov where both offering A$4.50 per ConsMin share – and the market was trading at A$4.69, but has got as far as A$5.44 as recently as two weeks ago.

With deadlines for bids drawing close (thank goodness), the question of who owns what is becoming somewhat important, hence the shock element behind today’s ConsMin filing that it has an “alien” on its share register. Experts contacted by Minesite were divided as to what the ownership questions points to. It is possible that a number of investors, hiding behind the corporate veil of a European bank, have ultimate title to the shares. If each owns less than 5 per cent no harm is done. If they are acting “in concert” and speak for more than 5 per cent then they are obliged to lodge substantial shareholder notices. Failing to do so is in the misdemeanour category, perhaps leading to a flogging with a wet lettuce leaf.

The nasty possibility is that someone associated with one of the rival bidders, or one of the sidelined bidders, of which there are another two, has quietly “warehoused” a big parcel of paper, waiting to slip it across at the appropriate time. If that’s the case then Australian law becomes quite onerous. ASIC (the Australian Securities & Investments Commission has strong powers to either (a) force ownership disclosure, or (b) actually quarantine the shares, and as a last resort take possession and sell them, returning the proceeds to the last known owner – or keep the cash if no-one claims it.

A spokesman for ConsMin contacted by Minesite said the situation really was a mystery after a series of attempts to discover the owner of the parcel. “That’s why we’ve turned to ASIC,” he said. “It wouldn’t be such a big issue if we weren’t the subject of competing takeover bids. But we really need to clarify who owns what so the market can be fully informed.” In the formal statement, ConsMin said it had “referred the matter to ASIC for further investigation and action”, adding that ConsMin reserves the right to “pursue further action through the Takeovers Panel in relation to this holding”.

Given that the ConsMin saga has dragged on for a year, and everyone is thoroughly bored with the name calling, this is precisely what was needed to breath a little life into a stale situation. However, to have it delivered as a mystery shareholder, inside a private bank is really quite delicious. *Plus, there’s the bonus of the chaps in grey cardigans from ASIC actually being forced to come out from behind their counters to do some work, poor darlings. *


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## Rimtalay (25 October 2007)

*ConsMin alert over secretive holding*

Kevin Andrusiak | October 25, 2007 
*CONSOLIDATED Minerals has called in the corporate regulator to help it trace the forces that now own an undisclosed 17.7 per cent stake in the company.

ConsMin said yesterday that despite its best efforts it had failed to trace the entities behind a shareholding of about 40.6 million ConsMin shares, which could become a key factor in the outcome of the takeover battle for the Perth-based carbon steels miner. *
Market experts doubted if ConsMin suitors Palmary or Pallinghurst Resources were behind the secretive buying, and suggested that hedge funds were more likely behind the stake. 

ConsMin's best efforts have traced the shares to Europe where they are being held by Euroclear Bank for ING Bank in the Czech Republic capital of Prague. 

No substantial shareholder notice has been lodged on the holding and ConsMin has referred the matter to the Australian Securities & Investments Commission to help trace the ownership. 

"CSM wishes to identify the beneficial holder of this shareholding as a matter of urgency," managing director Rod Baxter said in a statement to the Australian Securities Exchange late last night. 

"CSM also reserves its right to pursue further action through the Takeovers Panel in relation to this holding." 

ConsMin shares have been a favourite of day traders and hedge funds alike in the bitter takeover battle, as both Palmary and Pallinghurst vie for control of the company. 

The miner is seen as the last high-grade manganese operation to be put up for sale anywhere in the world, and control would allow the owner to blend the product with that of lower-grade ore and take a strategic stake in the manganese market. 

ConsMin shares have regularly changed hands above the $4.50 price offered by both Pallinghurst and Palmary, although Pallinghurst has promised to match any higher offer for the company through a special purpose top-up facility, dubbed The Aussie Axe. 

Palmary claims the facility is counter-productive to the auction process, and has called for a ruling from the Takeovers Panel. 

Heavy trading through most of the last month has regularly seen more than 3 million ConsMin shares change hands and the share price hover around the $5 mark. 

Based on public information, Palmary controls 14.29 per cent of ConsMin and Pallinghurst has a 6.98 per cent stake with an option to add another 5 per cent. 

Company investor relations manager David Brook said it was obvious the owners of the shares had gone to great lengths to conceal their identity. "If it is more than one entity, it would appear that it has been co-ordinated in some way," Mr Brook said. 

"There's nothing to suggest it is one of the current players." 

Consolidated Minerals shares closed 6c lower at $4.69.


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## nizar (26 October 2007)

Both Palmary and Pallinghurst have stated that they do not own that undisclosed holding nor do they know who's behind it.

Looks like we have a third player. At the very least its a blocking stake for the other two.

Let the games beginning, this could get interesting


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## noirua (26 October 2007)

I doubt that the private Norwegian Company, Tinfoss A.S., would have the cheek to use a subsiduary to purchase further shares in CSM; Or would they? Purchased a few shares early on today for an interesting gamble.


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## wintermute (29 October 2007)

hmmmm I've just taken the opposite approach and decided to put a bid in to sell half of mine (which will result in the other half being free carried if the order is filled). Just clicked over the 12 months on the first parcel, so get the CGT discount. 

Tony.


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## Rimtalay (30 October 2007)

*ConsMin’s mystery shareholders revealed*

30th October 2007, 15:15 WST

*Hotly contested takeover target Consolidated Minerals Ltd has uncovered the identity of most of the parties that have amassed a 17.7 per cent stake in the diversified miner.*
ConsMin said in a statement today that of the 40.6 million shares in question, four Cyprus-registered outfits - Torbock Holdings Ltd, Wadless Holdings Ltd, Trekin Investments Ltd and Almanzar Holdings Ltd - were identified as holding 35.5 million shares.

The four Cyprus-registered entities together hold just over 15 per cent of ConsMin, collectively making them the miner’s largest shareholder.

Belize-based Palmary Enterprises Ltd, which has won the support of the ConsMin board for its $1.03 billion takeover bid, holds 2.76 million shares, which adds to its existing 32.8 million ConsMin shares, giving it a 14.2 per cent stake.

However, the identity of the party or parties that hold the remaining 2.34 million shares remains a mystery.

Last week, ConsMin become aware of a holding of about 40.6 million ordinary shares that had not been declared to the market via a substantial shareholder notice and was registered in the name of ANZ Nominees Limited.

ConsMin accordingly referred the matter to the Australian Securities and Investments Commission (ASIC).

ConsMin said in the statement today that it appeared Palmary had disclosed the purchase through a substantial shareholder notice on October 18.

ConsMin has issued tracing notices to each of the four Cypress-registered entities and will advise them of the law requiring disclosure of substantial shareholdings in Australian listed companies.

ConsMin said it believed ASIC would also issue tracing notices to these parties.

"CSM (ConsMin) continues to reserve its right to pursue further action through the Takeovers Panel and/or the courts in relation to this matter,” the company said.

Shares in ConsMin closed one cent, or 0.2 per cent, higher to $4.89.


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## Rimtalay (30 October 2007)

I'm out now. Doubt whether I'll buy back in.
Good luck CSM holders. It's been a hard won victory, but worth it.


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## nizar (30 October 2007)

Rimtalay said:


> I'm out now. Doubt whether I'll buy back in.
> Good luck CSM holders. It's been a hard won victory, but worth it.




Victory?
lol the other bid from the mystery holder hasnt even come in yet.
This is far from over IMO


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## steven1234 (30 October 2007)

Rimtaly, many thanks for all your contributions and efforts in relation to CSM on this thread and many others.


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## Rimtalay (31 October 2007)

Yes, I consider it a victory, CSM shareholders can now get a fair price for their shares, $4.90 + on the market. It's possible now that the price will fall back to $4.50.

*ConsMin holding linked to Ukraine bidder*

October 31, 2007


*THE Ukrainian billionaire Gennadiy Bogolyubov's $1 billion bid for Consolidated Minerals is in disarray after it was revealed that, despite previous denials, his company, Palmary Enterprises, owns part of a mysterious 17.7 per cent stake in the manganese miner.*
The revelation could give the upper hand to the rival bidder, Pallinghurst - a group led by the former BHP Billiton chief executive Brian Gilbertson.

Last week ConsMin revealed unknown parties had built a 17.7 per cent stake in the company and that stake had passed through at least four custodians in Australia and Europe.

After receiving help from the Australian Securities and Investments Commission, ConsMin yesterday revealed the 17.7 per cent stake was held by ING Bank Ukraine on behalf of five customers, with 2.5 per cent owned by Palmary.

Palmary declared its interest in the 2.8 million shares in a substantial holder's notice lodged earlier this month.

But at least half of the remaining 15.2 per cent mystery stake is held by Cyprus companies that the US Securities and Exchange Commission has previously linked to Mr Bogolyubov's business partner, Igor Kolomoisky. The pair own Privat, the Ukrainian ferromanganese smelter which processes some of ConsMin's high-grade ore.

The companies with confirmed links to Mr Kolomoisky, Torbock Holdings and Wadless Holdings, have not filed substantial shareholding notices even though, combined, they control more than 7 per cent of ConsMin shares.

Palmary last week told the stock exchange it "confirms that it does not own the undisclosed shareholding and does not know who owns the undisclosed shareholding", adding it was involved in bringing the mystery holding to the attention of ConsMin. Palmary representatives were unavailable for comment last night.

It is understood ConsMin is likely to refer the case to the Takeovers Panel, which is already considering whether Pallinghurst's innovative plan to match any higher bid from Palmary with a "top-up payment" is acceptable.

There is speculation the mystery holding could be in breach of several Australian regulations beyond the failure to file a substantial disclosure notice. It could also breach the Foreign Investment Review Board requirement for permission to own more than 15 per cent of an Australian company. Additionally, some of the shares may have been purchased above Palmary's offer price of $4.50 a share in a potential breach of the Corporations Act.

Sources close to the deal said, based on precedent, the Takeovers Panel might force the holders to divest the stake via a book-build process.

"The ball now is in the Takeovers Panel's court," the Fat Prophets analyst Gavin Wendt said. "You would think it would have to put Gilbertson back in the driver's seat as far as the takeover scenario is concerned."


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## Rimtalay (1 November 2007)

*Pallinghurst's Consmin top-up cancelled*
November 1, 2007 - 6:10PM

*The Takeovers Panel has ordered the cancellation of Pallinghurst Resources Australia Ltd's novel `top-up' payment as part of its takeover bid for Consolidated Minerals Ltd.*

The order follows the panel's decision on Wednesday to declare unacceptable circumstances regarding the `top-up' payment, as requested by Pallinghurst's rival Palmary Enterprises Ltd.

In a media statement late Thursday, the panel said ConsMin shareholders who had accepted Pallinghurst's offer after the dispatch of its second bidder's statement, which included the `top-up' payment, could withdraw their acceptance.

Pallinghurst must advise affected ConsMin shareholders of their withdrawal rights, and the effect of the orders on other ConsMin shareholders as soon as practicable.

Pallinghurst, led by former BHP chief Brian Gilbertson, may withdraw either or both of statements made on October 12, which said the company would not increase its $4.50 per share bid or voluntarily extend its bid period.

The panel said Pallinghurst could do this by issuing a supplementary bidders statement on Friday.

Finally, the panel ordered Pallinghurst to extend its offer until November 16.

The panel has stayed its orders, excluding the order regarding the offer period extension.

Pallinghurst has lodged a notice of appeal seeking review of the decision, and the panel's president is now assembling a review panel.

Before the issuing of the panel orders, Pallinghurst said in a statement that it "strongly disagrees" with the Takeover Panel's decision to declare unacceptable circumstances.

"Pallinghurst also notes that it has obtained independent legal advice from a Queens Counsel, which confirms that the top-up structure is compliant with ... the Corporations Act," Pallinghurst said.

It also accused Palmary of possibly breaching Australian laws in its bid for ConsMin.

Pallinghurst said that Palmary chief Gennadiy Bogolyubov had been acting in concert with his Privat Group business partner, Igor Kolomoisky, amassing a significant amount of shares in ConsMin without disclosure to the market.

Under Australian law disclosure is required for shareholdings greater than five per cent.

It was revealed on Tuesday that Palmary was one of five companies that held a combined 17.7 per cent stake in ConsMin, but Palmary pleaded ignorance.

However, two of the four other companies appear to be connected with Mr Bogolyubov, a Ukrainian billionaire.

Pallinghurst said it had evidence that Mr Bogolyubov and Mr Kolomoisky "act as associates in respect of Palmary's offer for CSM (ConsMin)", and encouraged ConsMin and Australian regulators "to urgently pursue these serious matters".

ConsMin said in a statement that its enquiries to determine the ultimate beneficial owners of the 17.7 per cent interest continued.

Shares in ConsMin closed up one cent at $4.88 on Thursday.


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## noirua (6 November 2007)

Feeling a bit nervous about my recent purchase of Consmin, so, I've decided to dive out with a very small profit indeed. Hope it continues up for those still onboard - Good Luck.


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## lazyfish (4 August 2008)

Does anyone know what happened to consolidated? I can't find it on asx anymore, did it get delisted? Thanks.


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## Sainter (4 August 2008)

Yes, the new owner took it off the ASX. I doubt it is listed anywhere. He must be laughing with manganese prices the way they are, even if Woodie Woodie is having a few problems.


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