Daily Brief Australia: Virgin Money UK Plc, Latin Resources, Rio Tinto Ltd, Opthea Ltd, Nickel Industries and more

• Back on the 21st March, Virgin Money UK (VUK AU/VMUK LN), UK’s sixth largest retail bank, entered into a Scheme with Nationwide Building Society, at 220 pence/share, in cash.
• The consideration is a solid 38% premium to undisturbed. And shareholders backed terms at the 22nd May Court Meeting. Plus UK’s CMA signed off on the 19th July. 
• What now? FCA/PRA approvals are the key remaining conditions. These regulatory approvals are imminent.

• On 15 August, Latin Resources (LRS AU) disclosed a binding offer from Pilbara Minerals (PLS AU) at 0.07 PLS share per LRS share, a 66.3% premium to the undisturbed price. 
• The key condition is LRS shareholder approval. No disinterested shareholder holds the 25% blocking stake, and low retail ownership lowers the headcount test risk. 
• The Salinas definitive feasibility study, expected in September, provides option value. A strong result could draw a competing offer or force PLS into sweetening terms.  

• Discounts to NAV of covered holdcos did not follow a clear trend during August. Discounts to NAV: C.F.Alba, 46.2% (vs. 45.3% as of August 9); GBL, 41.1% (vs. 42.2%); 
• Heineken Holding, 16.5% (vs. 16%); Industrivärden C, 1.7% (vs. 2.2%); Investor B, 1.9% (vs.7.5%); Porsche Automobile Holding, 35.7% (vs. 34.6%). Rio DLC spread tightened to 19.8% (vs. 22.1%).
• What seems interesting (unchanged views): Porsche SE vs. listed assets and the Rio DLC (long RIO LN/short RIO AU).

• Opthea Ltd (OPT AU) completed enrollment in two Phase 3 trials for sozinibercept in wet AMD. Topline data from these trials are expected by mid-2025.
• During FY24, Opthea raised $295M to extend runway through topline data readouts of Phase 3 clinical trials. Further, in July, Opthea raised $38M through retail entitlement offer.
• Although Opthea is well-funded through mid-2025, any fund requirement beyond that period will be easier to meet amid lower interest rate scenario.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Meituan
• New World Development
• Nickel Industries