Interesting irony (LP on Agora) Cliffs SP has just broken through a major support level $32.25 (bounced on $32.00) on the day where Glencore's takeover of Xsrtrata will be voted on and at a time where their earnings have suffered a significant downturn . By all opinions it seems that the Glencore TO will pass, making it the fourth biggest mining company in the world.
Is this convergence?? If the ONTC plan is adopted or even perceived as being supported by Govs in the long term, then how much better can conditions be for Glencore/Xstrata to protect their Chromite sales and market in North America, by buying out the Cliffs' ROF Chromite assets or Cliffs altogether at garage sale prices.
If an offer were to come, we would see Cliffs dancing to a different beat. They would be compelled to push for a higher NAV of their CR assets, which in turn would work very favorably for the perceived value of KWG assets and its SP.
With RR issues covered by the proposed new plan (ONTC through port authority) GLXT is in a very strong financial position and a much better candidate than Cliffs (no comparison) to build the mine and smelter....let's remember that KWG PEA (Preliminary Economic Assessment) in 2011, enunciated three conditons that if fulfilled would support a KWG SP of $2.95 to $4.78 with production out of BD: the building of the NS RR, the mine and a smelter (notwithstanding the potential for concurrent direct shipping to buyers = immediate cashflow)
Let's just hope that Glencore/Xstrata (GLXT) are tired enough with dealing with problems in South Affrica, when the Canadian mining jurisdiction would be a cake walk comparitively.
Good luck to all KWG longs....even though!!!...luck seems to be losing its prominence as a factor in this case if the players just focus on profitabilty and common sense as it relates to environment, FNs and efficiency of operations. Cliffs' dropping of this proverbial ball, will go down in Canadian history as one of the biggest blunders of a guaranteed business opportunity that anyone could imagine.
I just noticed on BNN, that Xstrata shareholders have just approved the TO by Glencore...onward and upward......Per Ardua Ad Astra!!
Cheers to all
Le Penseur