OZL - Oz Minerals

[bigdog]

But how could that be, ZFX was made defunct by the OXR-ZFX merger? Do you know something we don't know?

I no nothing about what will or is to happen.

I am just guessing that there will be further offers because the offer IMO was low compared to the $12 billion value last year.

OZL have recommended that shareholders accept this low offer.

I think of the Flight Centre management takeover.

 

[bigdog]

http://blog.mdsfinancial.com.au/200...ver-–-what-will-the-government-be-looking-at/

OZ Minerals takeover – what will the government be looking at?
February 17th, 2009
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Chinese state-owned Minmetals has announced a $2.6 billion takeover offer for OZ Minerals.

Like the BHP – Chinalco deal, this will require federal government approval, so what are the considerations under review?

* Unlike the Rio deal, this would be a full takeover

* OZ is presenting the deal as a lifeline, and the only feasible alternative to receivership and the resulting implications for jobs, shareholder losses and growth projects

* The strategic importance of copper and zinc to Australia, arguably less important than the iron-ore Rio hopes to sell off

* The merits of the deal itself are complicated by external economic conditions

* National interest must be balanced with potential for a long-term strategic partnership with China

Traders and investors can again join in the action with OZ resuming trading today, after a halt called in November. Shares jumped up 29% this morning.

 

[bigdog]

http://www.theaustralian.news.com.au/story/0,,25067000-36418,00.html?from=public_rss

This article states in the last paragraph that:

"Former Oxiana founder Owen Hegarty has been rumoured to be interested in the Martabe mine."

 

[Prospector]

ZFX are gone; ie no longer exists. So nothing in the pipeline there. Maybe Rudd could give another stimulus package and buy OZL.

 

[gfresh]

As was stated in an article today, the offer at least puts a base value on the assets. Now others can assess their positions and place counter-offers if they so wish. In saying this, none have proceeded on any firm offers before this attempt, so you would wonder why they would jump out now... but you never know.

You'd also wonder why they'd need to beat 82.5c/share as well, when it seems right now they can grab large chunks of the co the 60's..

 

[frogfuzz]

panikhide: Is that before or after they grant themselves golden handshakes for "a job well done"

As a shareholder of Oz, I will be voting against this takeover. Why should I follow AM and his "management" "team" (sometimes I think their team is themselves: not shareholders)?

Under their stewardship (if you can call it that), I have watched my investment decline by around 85% (thanks to some “creative accounting”). And they now tell me this is a good deal and now I should vote for it?

If I knew that they'd be losing their jobs with no golden handshakes, well it would be tempting to vote for it - but hey - after losing tens of thousands of dollars already, in a company that supposedly had 1.2bill in the bank only a few months ago.......well what’s a few more thousand if it goes belly up?

Besides, I believe that BHP mines are close to Oz Minerals. Oz should play brinkmanship with this takeover. If Oz gets liquidated, their mines will be sold off (as I've said already, many ZFX shareholders like myself have already lost big time, what's the big deal about losing the last 15%?), thereby devaluing BHP. It's not in BHP's interests, is it? Oz Minerals management have about as much spine as a dead squid. Considering the millions that they've paid themselves you'd think they'd be a bit more "hard headed" when it comes to wheeling and dealing.

What happens to the proceeds of the gold mines they are flogging off (just as gold is about to take off thanks to the USA money printing machine)? I cannot believe the incompetence of this management. They make General Motors look like professionals.

 

[frogfuzz]

Prospector: I think KRudd gets more excited over Pink Bats than the ownership of Australian Mines. I'm sure Bob Brown and Peter Garret do also.

Besides: Pink Bats and Chinese ownership of our best mineral assets will:

a) Save the Planet from "man made" Global warming (after all; the Chinese are allowed to keep polluting, so really, they should own all our best mines. After all, if we burn the coal etc it will contribute to GW. If it's burnt in China it's OK.)

b) Get KRudd a cushy job after his time in politics (probably as a lobbyist for a Chinese State owned mineral company, lobbying his ALP mates for more Chinese ownership of Australian assets, and then getting paid big bonuses - see Con Scacca (sp) and Terry MacKenroth in QLD)

No wonder the Chinese government was happy at his election.

 

[bigdog]

Prospector: I think KRudd gets more excited over Pink Bats than the ownership of Australian Mines. I'm sure Bob Brown and Peter Garret do also..

The GREENS (Bob Brown) say of the offer:

http://greensmps.org.au/content/med...ctatorship-control-australian-resources—brown

Swan should avoid Chinese dictatorship control of Australian resources—Brown
Media Release | Spokesperson Bob Brown
Tuesday 17th February 2009, 1:33pm

The Federal Treasurer should disallow two massive bids by China's military dictatorship for Australian mineral resource companies, Australian Greens Leader Bob Brown said today.

"There is no way the Communist autocrats in Beijing would allow an Australian company to buy control of an equivalent Chinese resource," Senator Brown said.

"It is instructive to look at how they have handled Tibet and its mineral wealth-the Tibetans are the poorest people under Beijing's control.

"Both Rio Tinto and Oz Minerals are floundering but the Australian mineral resources they control will not disappear if these companies do. It is hazardous for our open and democratic nation to have the Beijing dictatorship, which forcefully suppresses democracies, take control of these companies and our resources," Senator Brown added.

"In both cases, the least that should happen is for Mr Swan to refer the decisions to a full parliamentary debate and vote.

For further information, please contact Ebony Bennett 0409 164 603

 

[skc]

200 million shares traded and there are still over 75 million on the sell side of market depth. Although buyers are slowly emerging (now up to 10m).

Couldn't help but think there will be a few twists and turns in this story yet.

Can anyone explain why the banks would decide not to offer a loan extension given the takeover offer? Doesn't it mean the debt will be owed by the Chinese company and essentially backed by the Chinese government? Or is the debt non-recourse at the mine / asset level so the banks can still lose out?

Discl: went long this morning.

 

[frogfuzz]

"Both Rio Tinto and Oz Minerals are floundering but the Australian mineral resources they control will not disappear if these companies do"

Is Bob Brown really concerned about the mines (and Aussie jobs) and prosperity, or is he more concerned that China may be pulling the strings? In one breath he says,

"mineral resources they control will not disappear if these companies do"

So clearly Bob Brown is against Chinese ownership. That's a good thing. But he also couldn't give a rats if the miners go broke. Yet he is happy to see billions of dollars wasted on Pink Bats.

Pink Bats or Australian mining. Which one do you think generates the most wealth (both jobs, equity, and income stream for the longer term)? Clearly Brown thinks Pink Bats are the better alternative.

 

[johenmo]

Pink Bats or Australian mining. Which one do you think generates the most wealth (both jobs, equity, and income stream for the longer term)? Clearly Brown thinks Pink Bats are the better alternative.

Pink batts probably buy more votes. Cynical outlook but closer to the truth than we'd care to admit. Should sell my OZl shares but there aren't many so I'll watch it over the next few days.

 

[thunderer]

While all the governments in the world are backing their strategical important companies, only Australian government can sit there and proudly and naively vaunting its market economy and legal system.
But shame on that we can't punish those stupid managers but let share holders bare all the loss.
As a share holder, of course I don't want to lose my money. But OZL share shouldn't be so cheap anyway.
But why none of those have a say say nothing, none of those have power want to help?
I guess most of them have another passport and they don't really care.If Australia run out of resource and turn into a third world country, they can still send their kids to US or Europe.

 

[Bobby]

I got caught holding OZL from the past & didn't sell today , it amused me to see the panic as the sheep sold off
Come on BHP " just show an interest before China grabs more of our future wealth

 

[bigdog]

When Minmetals gains control, I could well imagine Minmetals undercutting BHP and RIO pricing per orders from Beijing!

OZL is the third largest miner in Aust; is this correct?

I got caught holding OZL from the past.

 

[thunderer]

If BHP doesn't help OZL today, I bet it will be the next big mining company to sell big stake to China.
When China can get iron ore from Rio and minerals from OZL, what else does it need from BHP if it's not owned by China?

 

[oldblue]

If BHP doesn't help OZL today, I bet it will be the next big mining company to sell big stake to China.
When China can get iron ore from Rio and minerals from OZL, what else does it need from BHP if it's not owned by China?

Not just a " big chunk".
The proposal is for Minmetal to buy the entire company.

I hold a few OZL but don't hold out much hope that BHP will ride to the rescue.

 

[gfresh]

Doesn't seem like anybody even believes the Minmetals offer will go through.. down to 57c, or some 31% less than the offer price

 

[vincent191]

There is an article in the newspaper that cast doubt on Minmetals being able to come up with the funds. Guess, we will have to wait until more details become available.
I guess the whole deal is highly conditional.

 

[oldblue]

I doubt whether funding will be a problem.
Minmetals is a state organisation and funds will be available if all the other pieces, investment and political, fall into place.

 

[Bolivia]

At 56c alot of risk to this deal is being priced in. Is this a fair risk premium or not? IMHO alot of the selling down to these levels is a result of a) Margin lenders exiting en masse at any price and b) Existing shareholders taking their money and running.

So who will prove to be right?

Probably the most importent hurdle for this deal to be done, at least in the short term, is the banks agreeing to extend their deadline on refinancing. Why wouldn't they extend?
The other short term issue is Due Diligence. I know the management at OZ has been very questionable, but surely they wouldn't leave any skeletons for Minmetals to find and jeopardize the deal?

Assuming due diligence is OK and the banks extend, the only real hurdle is the FIRB. OZ does not really own any nationally significant assets. PH is a big project but not a national icon. So I can't see why the gov would have any issues.

Bottom line - has the share price factored in too much risk? IMO I think so. But am I willing to take the punt.... that is what I'm still debating!

Good luck to all that buy here.