In today’s briefing:
- Gina Joins SQM In Bid For Azure (AZS AU)
- Azure Minerals (AZS AU): SQM/Hancock Team up for a New Offer
- Lithium Power (LPI AU): Scheme Vote on 23 January
- Codelco’s Offer For Lithium Power (LPI AU): 23th Jan Shareholder Vote
- Ricegrowers Limited (SunRice) – Earnings Visibility Improves into FY26
- Neuren Pharmaceuticals (NEU AU): Positive Trial Result- A Step Ahead for Potential Second Drug
Gina Joins SQM In Bid For Azure (AZS AU)
- This makes life a lot simpler. Gina Rinehart’s Hancock Prospecting will now team up with Chile’s SQM to take control of lithium play Azure Minerals (AZS AU).
- In a binding Offer, by way of a Scheme, the joint bidders (collectively holding ~37.79%) are offering A$3.70/share, a 5.1% bump in terms to SQM’s prior Scheme Offer.
- An off-market takeover at A$3.65/share unfolds IF this Scheme were to fail. If both fail/lapse, SQM will, “in certain circumstances”, be required to proceed with its off-market transaction of A$3.50/share.
Azure Minerals (AZS AU): SQM/Hancock Team up for a New Offer
- Azure Minerals (AZS AU) has entered a new transaction implementation deed with Sociedad Quimica y Minera de Chile (SQM US) and Hancock at A$3.70, a 51.6% premium to the undisturbed price.
- The emergence of Hancock and Mineral Resources (MIN AU) as substantial shareholders necessitated the new offer. The off-market takeover offer is A$3.65 per share if the scheme fails.
- The scheme’s completion hinges on MinRes’ acceptance. MinRes could potentially block the scheme but has a history of selling into Hancock offers.
Lithium Power (LPI AU): Scheme Vote on 23 January
- The Lithium Power International (LPI AU) IE considers Codelco’s A$0.57 offer fair and reasonable as it is above the midpoint of its A$0.30-0.68 per share valuation range.
- The scheme is conditional on FIRB approval, which should be forthcoming as LPI’s assets are outside Australia in Chile.
- Irrevocables represent 32.05% of outstanding shares. At the last close and for the 16 February payment, the gross/annualised spread was 3.6%/26.3%.
Codelco’s Offer For Lithium Power (LPI AU): 23th Jan Shareholder Vote
- Back on the 18th October, Lithium Power International (LPI AU) announced it had entered into a Scheme Implementation Deed with Chilean state miner Codelco, the world’s largest copper producer.
- Codelco offered LPI shareholders A$0.57/share, a heft 119% premium to last close. LPI’s major shareholder, Minera Salar Blanco SpA with 27.88%, is supportive of the Scheme..
- LPI’s Scheme Meeting has now been tabled for the 23 Jan, with implementation expected on the 16 February. The IE is supportive and LPIs board unanimously recommends the transaction.
Ricegrowers Limited (SunRice) – Earnings Visibility Improves into FY26
- Ricegrowers Limited, trading as SunRice (ASX:SGLLV), has released its H1 FY24 results, delivering RaaS adjusted EBITDA of $69m (+68%) and adjusted NPAT of $33.3m (+107%), both well above RaaS estimates of $57.6m and $25m respectively.
- Divisionally the key surprise was International, delivering adjusted EBITDA of $33m, 125% above the PCP and 57% above RaaS estimates on the back of increases scale and reach, price increases and lower freight costs.
- Operating cash flow was the strongest since H2 FY18 despite a high tax payment as working capital improved from lower receivables and inventory reductions.
Neuren Pharmaceuticals (NEU AU): Positive Trial Result- A Step Ahead for Potential Second Drug
- Neuren Pharmaceuticals (NEU AU) has announced positive top-line result from its phase 2 clinical trial of its second drug candidate NNZ-2591 in children with Phelan-McDermid syndrome (PMS), a genetic disorder.
- PMS has an overwhelming unmet medical need. This is an attractive commercial opportunity with an estimated addressable patient population of 24,000 in the U.S. alone.
- NNZ-2591 has the potential to become the first FDA-approved drug for PMS. Neuren is also conducting phase 2 clinical trials of NNZ-2591 in children with three other neurodevelopmental disorders.
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