In today’s briefing:
- Rex: Diversification or Deworsification?
- Bubble Warning: China Internet Investment (810 HK) Suspended
- Norwest Energy Rejects MinRes’ Offer
Rex: Diversification or Deworsification?
- Rex International Holding (REXI SP) has announced further investments outside of its core oil&gas portfolio both related to its major shareholder. A major red flag.
- It is unclear whether these investments will bring real value to Rex as minority investors generally hate related party transactions without clear justification.
- The latest drilling campaign in Oman again encountered operational issues giving fuel to the bears that Rex is not capable of successfully operating its own fields.
Bubble Warning: China Internet Investment (810 HK) Suspended
- China Internet Investment Finance Holdings (810 HK) (CII), an investment manager, is currently suspended pursuant to the Hong Kong Code on Takeovers and Mergers.
- CII has thrice responded to unusual price action in its share price in the past four months. Shares are up a staggering ~1,000% in the past six months.
- This insight provides some background information on CII. Trading at 64x book value, this is one avoidable company.
Norwest Energy Rejects MinRes’ Offer
- In its Target Statement released this afternoon, Norwest Energy NL (NWE AU) has rejected Mineral Resources (MIN AU)‘s off-market scrip Offer.
- Norwest concluded the Offer was opportunistic and did not boast an appropriate premium for control.
- MinRes’ Offer closes on the 6 February – unless extended.
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