Miners fielding takeover bids and withdraws

Miners are fielding takeover bids and withdraws with Endocoal Limited (ASX:EOC) attracting a $71 million offer while a $435 million bid for Western Desert Resources Limited (ASX:WDR) is withdrawn.

 

Resources News

 

S&P revises Western Australia outlook

Standard & Poor's has revised its outlook on Western Australia because of its reliance on mining royalties and exposure to the sector. The ratings agency has revised its Western Australia outlook to negative and cautioned it may have to cut its AAA credit rating. S&P says, “We think there is downside risk to revenues, which could lead to a deterioration in operating performance. If this occurred, we'd expect to downgrade WA by one notch.”

Takeovers

Endocoal attracts $71M bid

Exploration company Endocoal Limited (ASX:EOC) has attracted a $71 million takeover offer from U&D Mining Industry (Australia), well above its market value of $43 million. The offer has been unanimously recommended by Endocoal’s board despite being subject to a number of conditions including regulatory and shareholder approval.

 

Meijin pulls out of Western Desert takeover

Western Desert Resources Limited’s (ASX:WDR) Chinese suitor Meijin Energy Group has withdrawn its $435 million takeover bid for the iron ore explorer. Western Desert has described the move as surprising and without warning, after the board supported the $1.08 per share offer last month, but has affirmed its commitment to developing its Roper Bar iron ore project in the Northern Territory.

 

Arrium bid rejects improved bid

Arrium Limited (ASX:ARI) has rejected a new and improved $1.19 billion takeover offer from Hong Kong’s Noble Group and South Korea’s POSCO. The sweetened bid of 88 cents per share comes after Arrium rejected an initial takeover offer of $1 billion, or 75 cents per share, earlier this month and the same offer last week. Arrium claims the revised proposal significantly undervalues the company and is highly conditional. 

 

Drillsearch boosts offer for Acer

Drillsearch Energy Limited (ASX:DLS) has increased its bid for Acer Energy Limited (ASX:INP) from 25.5 to 28.5 cents per share. The increased offer will come into effect if Drillsearch obtains a stake of 40 per cent or more for Acer. The oil and gas company now control about 20 per cent of Acer shares under acceptances from the previous offer. 

 

Neptune Marine scores $58M takeover bid

Neptune Marine Services Limited (ASX:NMS) has scored a $58 million takeover bid from a substantial shareholder. The subsea engineering services provider has been offered 3.2 cents cash per share from Singapore's MTQ Corporation Limited to acquire the 85 per cent of the company it does not already hold. 

 

Expansion Projects

 

Rio in ramp up mode

Global miner Rio Tinto Limited (ASX:RIO) has awarded two separate contracts worth a total of $129 million to advance its Cape Lambert Port Expansion in Western Australia. Nomad Building Solutions Limited (ASX:NOD) has scored a $28.8 million contract to design, manufacture and install 60 modular residential houses Southern Cross Electrical Engineer Limited (ASX:SXE) has won a $100 million contract for the supply and installation of the electrical and instrumentation package. 

 

Rio Tinto also this week awarded Monadelphous Group Limited (ASX:MND) $320 million worth of contracts to work on its Pilbara iron ore operations. The engineering and construction company will undertake construction and maintenance work for the global miner under separate contracts. 

 

Acquisitions

 

Worleyparsons buys South African engineer

Mining and energy services company Worleyparsons Limited (ASX:WOR) has acquired South African engineering designer TWP Holdings for $100 million and intends to integrate TWP into its existing South African business. Worley Parsons has also been awarded a $US90 million contract extension by BP Iraq and its partners to continue works on the super-giant Rumaila oilfield in Southern Iraq. 

 

Interview

FNN spoke exclusively to Matterhorn Asset Management Founder, Egon von Greyerz about how investors can maintain their purchasing power with gold. 

 

“Currently, it is all about preserving wealth. We are going to see a total destruction of wealth in the next few years, in my view. And therefore, it is all about preserving what you have rather than generating wealth”, Mr von Greyerz said. 

 

Mr von Greyerz believes holding gold and silver bullion stored outside the banking system can preserve purchasing power through eliminating counter party risk and recommends up investors devote up to 85 per cent of their portfolio to gold.