Chromex Share Discussion Threads

[bonsoir7] 08/9/2010 12:41

btw SJ you seem to have a good eye for these things do you have any other interesting situations on your watchlist ?

i like MWA and Ocean Equities mentioned NiPlats (ASX:NIP) which might be worth a gander?

i started a thread on NiPlats here :-

[bonsoir7] 08/9/2010 12:09

Interesting, very interesting.

Sailing John maybe you need to add Tata Steel to your list of potential acquirers ?

KOLKATA: Steel major Tata Steel is not selling its South African unit, a top company official said here Wednesday.

"We are not selling the plant...we are always approached by the buyers interested in our assets but it doesn't mean we are selling," H M Nerurkar, managing director, told reporters on the sidelines of a seminar organised by Confederation of Indian Industry.

He was asked to comment on earlier reports which said the company was looking to sell its South African unit.

Tata Steel KZN Pte, set up in Richards Bay, South Africa, in 2006, made profit last fiscal (2009-10).

"Now that the operations have started making profit, we plan to stabilise it and looking at buying ferro chrome ore mines there to secure supplies," he said.

[sailing john] 07/9/2010 14:44

LD - As you indicated there appeared to be a market anomaly between CHXW and CHX recently as shares moved up above 30p under staedy buying pressure but no warrant trades so they got left behind. Someone got a bargain yesterday.
Still a long way to go yet - so not expecting any further movement unless we get some leaks. The recent buyside pressure suggests that someone has confindence that the deal will be done above 35p IMHO
SJ

[leighton denny] 07/9/2010 14:15

In the space of a few days the warrants have gone from 6/11 to 11/15 with the shares hardly moving

[sailing john] 07/9/2010 09:02

Not surprised - I think the last few were snapped up yesterday. I don't think there are many/any shares on offer either.

[sitiain] 07/9/2010 08:39

there are no warrants on offer

[leighton denny] 07/9/2010 07:37

the shares are trading at 30-34 whilst the warrants are trading at 11-13 which doesn't look right

the shares at 34p are suggesting investors expect a higher offer or a good trading statement whilst the warrants are not fully reflecting that at the moment

[sitiain] 07/9/2010 07:27

ill buy your warrents at 10 pee saucepan

[saucepan] 06/9/2010 10:58

Yes, and I can dummy sell all my warrants for 9p. A week or so ago, I had the greatest difficulty trying to dummy smell small quantities at 6p.

I conclude that warrants are in demand/short supply. I'll be keeping hold of mine for a while.

[bonsoir7] 06/9/2010 10:20

warrants moving today

[sailing john] 03/9/2010 09:04

So my revised list of potential buyers is now
Suzhou Kaiyuan Chemical Co - $5m loan and 2 year offtake agreement
Samancor - Mecklenburg adjacent assets and infrastructure
Ruukki - Massive investment in new furnaces and power plant announced
Others
Merafe, Hernic, IFL - existing SA - FeCr producers
Other Chinese FeCr producers wanting secure supplies of Chromite
I still view the value of the existing assets at 50p+ (circa £50m) but there might be a premium for keeping the assets away from a competitor say +10p.
Not expecting any news for quite a while - Mecklenburg is likely to be a due diligence hurdle that might take some time to resolve before potential buyers commit. All IMHO of course and DYOR
SJ

[sailing john] 03/9/2010 08:52

A little more research on Ruukki' acquisition of Mogale Alloys turned up this from May 2009

No mention of Chromite mines in the acquisition just furnaces.
The current proposals will increase capacity from three furnaces total 96MVA to 5 furnaces total 236MVA plus matching power plant (ie increase from circa 100,000T/annum to 250,000T+/annum)
And this from another press article at the time quoting Ruukki
"As demand recovers, ferrochrome market prices are expected to outperform other minerals, owing to limited supply and growing demand. The Mogale transaction expands and diversifies Ruukki's current Turkish and German minerals capabilities of special grade ferrochrome, and gives opportunities to utilise existing sales channels," he commented.
Press comment at the time of Mogale acquisition
The Mogale acquisition is a cornerstone transaction in Ruukki's expansion into South Africa, which is one of the leading areas of minerals production. The Mogale platform will help Ruukki to pursue related acquisitions in various minerals and alloys operations, such as chrome and platinum assets.

[sailing john] 03/9/2010 07:15

Interesting post LD - will add Ruukki to the list of potential buyers. Looks like they are investing a few hundred million pounds in the powerplant/chrome furnaces so another £35m+ for Chromex would be peanuts and secure their chromite supplies for 50years+.
edit - Having read the above post again it would make sense for Ruuki to put feelers out for new Chromite sources as part of their planning for the above project. And the timing fits nicely - perhaps 2+2=5 thinking but that is what investing is about.!

[leighton denny] 03/9/2010 00:01

maybe we will get a CHX update from Ocean Equities soon ?

Ruukki builds two Cr furnaces, power plant to boost minerals business (Weds, 1st Sept)

Ocean Comment: The Ruukki Group's announcement that it will build two DC chrome furnaces and a new power plant again highlights its ambitions to expand its Minerals Business and follows the failed merger last year with Sylvania Resources (announced in Jun'09 at a 44% premium to the 30 VWAP and cancelled Oct'09). The two proposed infrastructure developments announced on September 1st form part of Ruukki's stated strategy to grow its presence in South Africa through increasing production capacity and expanding market share. The obvious question now is, where is the ore for the proposed furnaces going to come from and how could Ruukki integrate upstream operations or secure sufficient and reliable offtake? Following on from the decision to terminate the merger implementation agreement with Sylvania, Ruukki has stated that it will continue
to focus on pursuing opportunities to produce Platinum Group Metals ("PGMs") as part of its strategy towards vertical integration, utilising the existing smelting operations to capture additional value. The existing Ruukki furnaces, currently used for production of ferrochrome and other metal alloys, can be modified to process other minerals including PGMs. Ruukki remains a well funded, established processing infrastructure group looking to unlock value from PGMs and ferrochrome from mine to metal.

Under the framework agreement, MCC will oversee the construction of two 70MW, single electrode submerged arc DC furnaces. GLPS is the design and engineering company and is currently in the process of design works and detailed engineering
which are expected to be completed by 4Q'10. Negotiations to convert the framework agreement into a formal contract are expected to be completed by mid'11. Ruukki is currently conducting a site selection exercise and expects to make a final decision by the end of 2010; again you would expect site selection to be impacted by where Ruukki expects to secure its ore from. The second proposed infrastructure development comes in the form of a new power plant. Ruukki intends to build a 250MW power plant in South Africa to expand its energy options for its expanding operations and under the framework agreement, MCC will complete a Feasibility Study by mid'11.

Ruukki Group's Minerals Business has operations in Southern Europe and South Africa. The Southern European minerals business consists of mining and beneficiation operations in Turkey (which continues to get expanded with a new plant commissioned in May'10), chromite concentrate processing operations in Germany and procurement and sales operations in Malta. The South African business consists of smelting operations with four furnaces. The Group's aim is to become a vertically integrated mine-to-metals producer in selected minerals and alloys in selected geographical areas.

Through the acquisition of the chrome ore and ferrochrome businesses in Oct'08 and by the expansion into South African minerals sector via Mogale Alloys acquisition in May'09 (total purchase consideration was ~€174m for its 84.9% interest), the Group has diversified its industry risks, and is less vulnerable to the wood processing industry. However, during the 6 months to Jun'10 the South African Minerals Business generated EBITDA of €4.1m on revenue of €29.8m and while only being a relatively small component, 50%, of group EBITDA. On July 26th Rukkii was admitted to trading on the main market of the LSE and maintains its primary listing on the Helsinki Stock Exchange (current market cap EUR444m).

We are undertaking various site visits in the Bushveld complex next week and look to provide a review of the trip in due course.

[leighton denny] 02/9/2010 07:49

Excellent, much appreciated.

[sailing john] 02/9/2010 07:30

LD - Listed below is the expected news flow
July - Zimbabwe: Upgraded SAMREC compliant mineral resource statement
August - Zimbabwe: Update and Pre-feasibility Study on Trixie claims
September - Stellite: Commissioning of DMS plant
October - Stellite: Ramp up of production and first sales of lumpy product Stellite: PGMs & gold pre-feasibility study Zimbabwe: Feasibility Study on Trixie claims
December - Stellite: Full production at Stellite
Given the current work on due diligence I'm not expecting any further news on these although I might pester them about Zimbabwe. I'm guessing the resolution of Mecklenburg legals is taking up most management time together with due diligence - Zimbabwe in particular.

[leighton denny] 01/9/2010 23:33

sj, ex-ing out the M&A interest when do you think we should get more news on operational issues such as

1) The DMS at Stellite due for 'commissioning October'
2) PGE recovery/scoping
3) Mecklenberg (legal and operational issues)
4) Zimbabwe

good news on any of these fronts could justify a higher share price in and of itself but also add more competitive tension to any ongoing M&A discussions

[sailing john] 01/9/2010 21:17

Finnish natural resources processor Ruukki Group has signed framework agreements with Metallurgical Group Corporation to build two DC chrome furnaces and a 250MW power plant in South Africa.
Project includes upgrading existing furnaces to increase capacity. This massive investmet in SA chrome is very positive. :-)
SJ

[kenmitch] 01/9/2010 19:21

Thanks Saucepan and energiser01.

Mangal provides loads of quality information on ADVFN on warrants and subscription shares and in addition to his posts keeps this list of many of the equity warrants available.



A few more days like today and some of the warrants and subs currently very cheap technically could soar. Hope CHXW proves to be one of them.

[leighton denny] 01/9/2010 16:26

Albanian Minerals President & CEO Mr Mujaj said that "Economic growth in China and India will help U.S economy
Global economy is set to recover and the global consumption of gold, oil, natural gas, food and metals will increase. With 2.5 billion people China and India will be a huge market for US companies".
"Demand and prices will grow for wheat, oil, natural gas, steel, cooper, aluminum, gold, silver, iron ore, uranium, chrome ore, row materials and other metals".

[leighton denny] 01/9/2010 16:24

Two manufacturing surveys in China, by far the world's largest metals consumer, showed that activity picked up last month after a government-engineered slowdown.

China's official purchasing managers index rose to 51.7 in August from a 17-month low of 51.2 in July, while HSBC's PMI rose in August to a three-month high of 51.9 from 49.4 in July, as both output and new orders resumed growth.

"Stocks and metals are up today as a result of the announcement as demand fears recede and industrial growth prospects improve," John Meyer of investment bank Fairfax said.

[bizz2bizz] 01/9/2010 14:46

Hi there....the guy who's buying at 31p, is the deal done yet. I assume you're the same guy who was the buyer yesterday ahead of the article in the F.T!

[energiser01] 01/9/2010 11:06

Well between Kenmitch and Mangal you will struggle to find posters who have done more to educate others on warrants/subs, the technicalities/risks and provide comment on opportunities etc. across the boards over a number of years.

All views are welcome of course, but to suggest you know someone based on posts on here says more about you......