Takeover Targets

http://www.theaustralian.news.com.au/story/0,20867,21738889-5005200,00.html

Xstrata trumps bid for LionOre
Andrew Trounson
May 16, 2007

FRESH takeover speculation is set to sweep Australia's nickel mining sector after Swiss giant Xstrata raised its bid for Canadian miner LionOre to $6.7 billion.

The all-cash bid trumps Russian giant Norilsk's competing bid by $947 million, and is 35 per cent above Xstrata's opening offer launched in March.

Xstrata chief executive Mick Davis is well-known for being an aggressive bidder as he backs the commodities boom. His move could give further encouragement to other global miners to become more aggressive.

Takeover speculation is sweeping the global resources sector as miners seek to buy scarce mining assets to capitalise on the metal price boom.

Aluminium giant Alcoa this month launched a $US28 billion ($34 billion) bid for Canadian rival Alcan that could yet attract a counter-offer from the likes of BHP Billiton or Rio Tinto.

Meanwhile, Rio Tinto itself is being tipped as a target, as is Anglo American.

Investment bankers are known to be scouting for targets in the Australian nickel sector. There is speculation that nickel miners such as Jubilee, Sally Malay and Western Areas could be under the microscope.

Minara Resources, operator of the Murrin Murrin mine, might be less of a target given that it is 50 per cent owned by Swiss commodities giant Glencore, although it could become a target for Xstrata given that Glencore controls about 40 per cent of Xstrata.

LionOre has significant nickel assets in Western Australia, including the Black Swan and Lake Johnston operations, as well as the Honeymoon Well nickel project, a feasibility study on which is due by mid-year.

It also owns mines in South Africa and Botswana and has forecast nickel production this year at 44,000 tonnes.

LionOre has a listing in Australia that it was due to cancel next month. Share trading was halted yesterday ahead of the announcement and the stock last traded at $25.98.

Xstrata is the world's fourth largest nickel producer and last year beat off competition from US copper giant Phelps Dodge to buy Canadian nickel major Falconbridge for $22 billion.

LionOre's board has backed Xstrata's higher offer. Xstrata has raised its offer to $C25.00 a share, up from $C18.50 and ahead of Norilsk's $C21.50.

LionOre shares have risen this year by almost 79 per cent as nickel prices have more than doubled in the past year to $US18.80 a pound.

Earlier, LionOre reported a massive rise in first-quarter profit to $US148.3 million from just $US13.2 million a year ago. Sales rose to $US525.4 million from $US126.7 million.

More rumors of takeovers in the resources sector. This time BHP, RIO and CVRD are touted as being possible bidders for Alcan over the current bid from alcoa.

http://www.canada.com/nationalpost/...=62eb2b41-8dd0-42fd-b56c-60125e260708&k=99592

http://www.news.com.au/heraldsun/story/0,21985,21841656-664,00.html

Great Southern target
George Lekakis

June 04, 2007 12:00am
AUSTRALIA'S managed investment scheme sector is facing a bout of mergers and takeovers following the slide in the share prices of leading players.

BusinessDaily revealed last week that at least two private equity firms were running the ruler over Victorian-based agribusiness investment group, Timbercorp.

Now, the Perth-based Great Southern Limited has also been linked to takeover speculation.

An industry source told BusinessDaily that Great Southern, which is currently trading on an earnings multiple of less than 6 times earnings, has entered preliminary merger talks with a private equity group.

"The talks are at an early stage but have been going on for more than a week," the source said.

The shares of leading agribusiness investment companies such as Timbercorp and Great Southern have more than halved in the past year since the Federal Government announced plans to remove tax breaks on investments in managed schemes covering non-forestry plantations such as olives and almonds.

Trading in Great Southern scrip has intensified in the past three months as the share price fell below $2 -- its lowest level in more than three years.

WGP could possibly be in the near future.

All I need to say is BP and Rio Tinto:

Read the article below and see what you think.

http://www.asx.com.au/asx/statistics/showAnnouncementPDF.do?idsID=00723579

http://www.theage.com.au/news/busin...s/2007/06/14/1181414464393.html?page=fullpage

Merger talk fires Woodside shares
Barry Fitzgerald
June 15, 2007

WOODSIDE shares have raced to an 11-month high in response to speculation that it will merge with London-based BG Group, creating a $90 billion global gas giant.

While firmer oil prices and yesterday's broadly based bounce in equity markets helped, it was the speculation on the possibility of a merger with BG that fuelled the $1.84, or 4.3 per cent, rise for Woodside to $44.52 a share, valuing the Perth-based group at $30 billion.

The rise was despite the broker's report that triggered the speculation emphasising that it was looking at the merits of a merger between the two as a concept only.

Woodside has been considered off limits to foreign groups since federal Treasurer Peter Costello banned Shell's $10 billion bid in 2001 on national interest grounds. Shell owns 34 per cent of Woodside and has long been touted as a potential buyer of BG, valued by the market at $63 billion.

The suggested pathway to gain clearance from Canberra in any bid for Woodside involves the creation of a dual-listed company under which Woodside's identity, Australian base and tax domicile would be preserved. A combined BG-Woodside could challenge for leadership of the global LNG industry, albeit with Shell as a major shareholder.

After the Canberra ban on a Shell takeover, Woodside held talks with BHP Billiton and Santos about possible mergers, which in the case of BHP would have been limited to a deal involving its oil and gas division. Nothing came of those talks.

Woodside has grown to be an annual producer of 68 million barrels of oil equivalent (2006), with output this year forecast at 72-78 million boe. BG is a bigger company, with production in the first quarter of 58.2 million boe.

Woodside increased its exploration and development spending this year to $3.6 billion, with work starting on its Pluto LNG project. It also has aggressive development plans for the Browse and Sunrise projects.

http://www.theage.com.au/news/busin...t/2007/06/19/1182019115969.html?page=fullpage

Woodside ignites on talk of renewed Shell interest
Dinakar Sethuraman
June 20, 2007

WOODSIDE Petroleum shares rose to their highest in a year after a report that 34 per cent shareholder Royal Dutch Shell might bid for Australia's second-biggest oil and gas producer.

The stock of the Perth-based company rose as much as $1.23, or 2.7 per cent, to $47.18 on the stock exchange, a 52-week high after LNG Intelligence said Shell might try again to buy the rest of the company.

Woodside shares closed yesterday at $46.85, a full-day gain of 90 ¢.

Woodside spokesman Roger Martin declined to comment.

The Government in 2001 prevented Shell from increasing its stake in Woodside, citing national interest.

Woodside is the operator of the North-West Shelf Venture that exports about 12 million tonnes of liquefied natural gas a year. It is also proposing to spend as much as $10 billion to develop its Pluto LNG project off Western Australia.

Shell might not act on any proposed offer before the coming federal election, LNG Intelligence said. Shell might be able to ship more LNG to the US if it gained control of Woodside, the report said.

Last week, Britain-based broker Cazenove Group said that a merger of BG Group Plc and Woodside might be of substantial benefit to both companies.

LNG is natural gas chilled to liquid form for transportation by tanker to destinations not connected by pipeline.

http://www.theaustralian.news.com.au/story/0,20867,21960213-643,00.html

Jubilee a nickel-plated target
Kevin Andrusiak
June 25, 2007

JUBILEE Mines' nickel dreams continue to grow at its Alec Mairs deposit, as sources say the company is becoming too big to ignore as a possible BHP Billiton takeover play.

BHP operates a nearby mill that is running well under capacity and, in the long term, it has its eye on ensuring a reliable inventory of high-grade nickel ore.

Goldman Sachs JB Were materials analyst Ian Preston has forecast net profit for Jubilee of $193.8 million this fiscal year and $162.2 million next financial year, based on a deterioration of the nickel price.

But Mr Preston believes that global shortages of nickel might one day mean Jubilee becomes a takeover target.

"We are also very cognisant of the paucity of high-grade nickel sulphide ore bodies globally and the increased focus of the majors for concentrate feed for smelters," Mr Preston wrote in a recent report to clients.

Drilling continues to show the Alec Mairs 5 deposit, adjacent to Alec Mairs 2 and 500 metres south of the Cosmos Deeps mine, has the potential to raise Jubilee's nickel inventory to around 400,000 tonnes of metal. "These new results confirm Jubilee's belief that the wider Alec Mairs Complex is an emerging large mineralised system with potential for multiple substantial sized nickel sulphide deposits," Jubilee announced earlier this month.

Bell Potter analyst Stephen Thomas said Jubilee was on track for a record first-half result and the AM5 discovery had the potential to double Jubilee's nickel reserves. "We estimate the AM5 discovery has sufficient size, grade and accessibility to lift Jubilee's production profile to around 50,000 tonnes per annum," Mr Thomas said.

"This is a major value and earnings uplift event and further enhances the massive corporate appeal of JBM."

He believes Jubilee could return a net profit after tax of $211.2 million this financial year and $320.4 million in 2007-08. He has put a 12-month price target of $23.08 on Jubilee stock.

One hope for Jubilee is that BHP Billiton might find it too difficult to ignore its near neighbour in the West Australian Leinster region.

Any takeover play would have to appease Jubilee founder Kerry Harmanis, who controls a 15.2 per cent stake in the company.

But he has always maintained that he will sell his stake if the price is right.

Sources said BHP's Perserverance mill was being under-utilised and running at only 60 per cent capacity while the mining heavyweight was having problems with magnesium oxide clogging at its Kambalda operations. The Perserverance mill is only 30km south of Jubilee's Cosmos operations while the ore could also be blended and used in the Kambalda smelter. "They will soon have about $15 billion worth of nickel. That's why BHP will find Jubilee too hard to ignore," the industry source said.

"It never made sense before when Jubilee only had 110,000 tonnes of nickel inventory.

"I haven't heard anything yet about a BHP approach, but you would have to think they are quietly running the ruler over the company.

"Why would they like any other company? Jubilee has been the best exploration company Australia has seen over the past 10 years."

I monitor potential targets on a daily basis including the special trades each morning before the start at !0:00 AM

Normally there are only a few trades and always BHP

Today's action is significant in $ and the number of companies that I watch:

Any idea who is buying???

http://www.theage.com.au/news/busin...e/2007/07/03/1183351209410.html?page=fullpage

Last paragraph for Age article on Citi:
The top-four anticipated deals in the region were between Australian companies, including a rumoured $1.4 billion bid for Ausdrill by an unnamed suitor, Transfield's bid for GRD, the tilt for Orica by a group of private equity firms and an unidentified approach to Great Southern.

DOMINANCE in Europe has made the world's biggest bank, Citi, the world's top financial adviser to mergers and acquisitions.

In the first six months of this year, Citi (formerly Citigroup) advised on deals worth $US814 billion ($A950.3 billion), according to rankings by research house mergermarket. This was more than $US17 billion ahead of No. 2 Goldman Sachs.

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http://www.theaustralian.news.com.au/story/0,20867,22013583-643,00.html
Local mergers now worth $133bn
Chris Merritt, Legal affairs editor
July 04, 2007

TAKEOVER activity in Australia and New Zealand almost doubled in the first half of theyear and is now worth $US114.3 billion ($133 billion), according to Thomson Financial.

Thomson says the deals announced so far this year represent a 99.2 per cent increase over the $US57.4 billion worth of transactions announced in the same period last year.

Despite the strong growth, mergers and acquisitions in Australia and New Zealand remained a small fraction of the global total.

Worldwide mergers and acquisitions increased 62 per cent in the first half of the year to reach $US2.7 trillion. Around the world, deals worth $US641 billion were announced in April, making that month the busiest on record.

Merger and acquisition activity slowed in the second quarter in what Thomson described as more challenging credit conditions and the annual slowdown for the northern summer.

In Australia and New Zealand, the surge in the value of deals was accompanied by a 20.5 per cent increase in the number of deals - up from 1351 this time last year to 1628.

The Thomson figures, which were assembled before Wesfarmers' $22 billion bid for Coles, show that the real estate sector accounted for most activity.

Thomson says the biggest deals so far this year were the $11.4 billion bid for Alinta, the $8.9 billion bid for Orica and the $5.7 billion takeover of Toll.

Thomson says private equity players continued to play a major role in the global boom in mergers and acquisitions.

They were involved in global deals worth $US644 billion during the first half of the year - which accounts for 24.3 per cent of overall volume.

This means the involvement of private equity in global takeover deals increased 95.1 per cent over the same period last year.

Private equity was an even stronger force within the US.

These players accounted for 36 per cent of overall US takeover activity in the first half of the year and 40 per cent of US deals in the second quarter.

GTP - it is one of the few stocks with top 20 Dividend returns that is not owned by a Banks Investment arm.

coates hire

you heard it here first...

a bidding war is shaping up between various PE firms

DYL ...full t/o by PDN

OXR full t/o of TOE after the dust settles with NEL

redandgreen said:

OXR full t/o of TOE after the dust settles with NEL

Click to expand...

That is rediculous, OXR spun of TOE at 25c, they wouldn't have bothered if they had any interest in developing the uranium themselves.
I guess if TOE find a major discovery OXR would go in since they can block any attempt with the holding.

NEL is a better prospect that TOE at this stage even allowing for WA no uranium mines stance

Re: Next Merger or Takeover (your guesses)?

Julia said:

michael_selway said:

Hi we all know about the TOL & PRK takeover, RCD & Allco merger, Mayne Demerger etc etc

What are your guesses for future mergers & takeovers?

Im thinking ADB & BEN merger? Possible?

Any others?

Thanks

Click to expand...

Re ADB & BEN, have you actually heard that this is being discussed, or just taking a hypothetical? It's an interesting thought, but would require some compromise on the part of both in terms of their underlying philosophy.


Julia

Click to expand...

Hi Julia

Wellm yes it was only a hypothetical at the time

thx

MS

Does anyone have any thoughts or insight on to GTPs release to the market 2 months ago that it was being solicited for a takeover?

Maybe a merger between them and TIM or Auspine possible? or perhaps a Macquarie target as they are effectively a quality investment product.

Re: Next Merger or Takeover (your guesses)?

Originally Posted by Julia
Quote:
Originally Posted by michael_selway

What are your guesses for future mergers & takeovers?

Im thinking ADB & BEN merger? Possible?

Any others?

Thanks

Re ADB & BEN, have you actually heard that this is being discussed, or just taking a hypothetical? It's an interesting thought, but would require some compromise on the part of both in terms of their underlying philosophy.


Julia

michael_selway said:

Hi Julia

Wellm yes it was only a hypothetical at the time

thx

MS

Click to expand...

At least we can understand BEN's rejections of BOQ's persistent overtures a little better now.

For those of you who dont know corporate express NV (formerly Buhrmann NV) recently had over 5% of its shares purchased by a fund infamous for breaking up companies and selling off the best bits at significant premiums.

Corporate Express Australia, would certainly be considered one of the better bits. If there was a forced sale, it would open the gate to a possible management buyin or a competitor bid.

Re: Takeover Targets CXP

CXP Australia could be forcefully sold by Corporate express NV.

Corporate Express NV mother of Corporate Express Australia, has recently had over 5% of its shares purchased by a fund/investor infamous for breaking up companies with underperforming share prices and selling off the best bits.

CXP (Corporate Express Australia) is certainly one of the better bits and could be either taken over by a competitor or bought out by its own management team.

http://www.news.com.au/heraldsun/story/0,21985,22579637-664,00.html

Takeover activity to rise
Article from: Sunday Herald Sun
Anthony Black
October 14, 2007 12:00am

INVESTORS can expect increasing takeover activity as the credit squeeze eases, analysts say.

They say private equity firms as well as listed companies are sniffing out bargains in a market enjoying a resurgence in confidence.

A cut in US interest rates followed by better-than-expected payroll numbers reduced the possibility of the US sliding into recession and stifling global growth.

Mark Goulopoulos, of Tolhurst, said the resources sector was ripe for consolidation, particularly among mid-sized miners as the outlook for commodity prices remained positive.

Mr Goulopoulos said the share price of the target generally rose sharply in anticipation of a possibly higher bid or bidding war.

He said Murchison Metals' bid for Midwest Corporation on Wednesday sent Midwest's share price up 30 per cent soon after it was announced.

Mr Goulopoulos said miners with an identified base metal close to infrastructure appealed to suitors. But, he warned, while a share price could rise on takeover rumours, it could tumble just as fast if facts emerged it was not a target.

SALLY MALAY MINING: Mr Goulopoulos said the nickel producer was benefiting from a nickel price that had more than trebled to $30,000 a tonne in the past three years.

"Nickel is probably one of the most attractive commodities in terms of price," he said.

Mr Goulopoulos said Sally Malay Mining was generating lots of cash and the company was relatively cheap.

"That's what makes it appealing," he said.

INDEPENDENCE GROUP: Mr Goulopoulos said Independence had a 30 per cent stake in the Tropicana gold project in WA, which is promising substantial reserves.

He said a strong gold price appealed to bidders.

Mr Goulopoulos said Independence was generating strong cash flow from its nickel mine and the company was debt free.

OIL SEARCH: Scott Marshall, head of Shaw Stockbroking's industrial research, said Oil Search's highly valued gas resource in Papua New Guinea was attracting immense international interest.

He said the gas assets offered significant production potential of a proven and probable resource, including associated liquids, of almost a billion barrels of oil equivalent.

Mr Marshall said takeover speculation would persist despite the company saying last month that no formal approaches had been made.

AMCOR: Mr Marshall said the fallout from the price-fixing cartel case with Visy left Amcor in a precarious position.

He said Amcor's share price could suffer from companies collectively seeking hundreds of millions of dollars in compensation.

Mr Marshall suggested investors buy Amcor on share price weakness as its global assets held considerable takeover appeal, particularly at a discounted price.

CSR: Mr Marshall said CSR was a "perennial break-up story" and its three divisions, -- sugar, aluminium and building materials -- could be sold as one or separately.

OTHERS: He said the food industry was lining up for consolidation and he suggested keeping a close eye on Goodman Fielder as New Zealand billionaire Graeme Hart's 20 per cent stake was out of escrow and could be sold.

He said Foster's was a possibility if it stumbled and Flight Centre might once again appeal at the right place.

Mr Marshall said property trusts, such as the APN/UKA European Retail Property Group and the Rubicon Europe Trust Group appealed to bidders as they had valuable assets overseas.