HIGH-GRADE NI-CU-PT-PD-ZN-CR-AU-V-TI DISCOVERIES IN THE "RING OF FIRE"
NI 43-101 Update (September 2012): 11.1 Mt @ 1.68% Ni, 0.87% Cu, 0.89 gpt Pt and 3.09 gpt Pd and 0.18 gpt Au (Proven & Probable Reserves) / 8.9 Mt @ 1.10% Ni, 1.14% Cu, 1.16 gpt Pt and 3.49 gpt Pd and 0.30 gpt Au (Inferred Resource)
Message: Forrest and BHP go to war over a company no one has ever heard of
Exactly..... a company no one has ever heard of. Good job Coutts and team. Exactly.... like pocket change for these majors.....good job elevating the company's net worth Coutts and team. Why the secret agent private placement to BHP Coutts and team?
Didn't I hear Coutts mention they might have a place at BHP when this amazing .55 offer was graciously accepted by us shareholders?
Well it seems that the little shareholder has a bit of Forrest's tenacity and will put up a fight to carry out its dream.
Maybe it will be Forrest who raises the ring from the ashes....a phoenix shaped like a ring.
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Forrest and BHP go to war over a company no one has ever heard of
Elizabeth Knight
Business columnistAugust 31, 2021 — 3.54pm
BHP versus Andrew Forrest was once a David and Goliath fight confined to the Pilbara. Today the battle between the two titans of iron ore, has moved to the far reaches of Northern Canada and the quarry they both seek is a nickel company no one has ever heard of.
So small and financially embattled is Noront Resources, that nine months ago it was worth just around $70 million dollars - little more than the petty cash held in the head offices of BHP and Forrest’s Fortescue.
Thanks to the bidding war between Forrest and BHP, Noront is now capitalised at $380 million and counting. Forrest lifted his offer this week to C70 cents per share - trumping BHP’s C55 cents.
Andrew Forrest has turned up the heat on BHP in the fight for Noront Resources.Credit:Bloomberg
Despite his corporate and financial success the battle still feels personal for Forrest who is prepared to devote time and emotion to a bare knuckle brawl with the Big Australian.
In many ways it feels a bit like the good old days when as Australia’s blue blood corporate establishment miner BHP revelled in taking pot shots at the then corporate upstart, Andrew Forrest.
Fifteen years on, Forrest’s success has made him the richest man in the country and BHP is more circumspect about its Twiggy jibes. But a certain level of disdain for Forrest is still embedded in the fabric of BHP’s culture - and also that of Rio Tinto.
The fight for Noront opens up a new battleground for BHP and Forrest as both look to burnish their credentials as companies investing in future-facing commodities, the demand for which is rising as the world looks to decarbonise.
Noront owns a highly lucrative but prospective area called the Ring of Fire in Northern Ontario which is brimming with high-quality nickel, chromite and copper. The net present value of these reserves are conservatively estimated to be multiple billions and made all the more attractive thanks to being located in sovereign risk-free Canada.
That’s the good news. The bad news is that the area is remote and currently devoid of the infrastructure needed to begin development.
Indeed, Noront has a chequered history of ownership - having seen off several major investors, including US heavyweight Cliff Resources, that have been financially burned after the stranded assets proved too expensive to develop as commodity prices moved around.
The same issue left Noront with no choice but to find a corporate big brother with sufficiently deep pockets.
It now seems to have found two and to date the board appears to have found a way to play them off against each other.
Forrest has acquired a stake of 37.5 per cent (held through shares and convertible debt). Earlier this year he offered to provide the company with a loan which it declined, choosing instead to raise cash through a placement of 5 per cent of its stock to BHP.
Noront announced the placement but curiously didn’t reveal who had taken the stock.
Forrest hit back with a non-binding proposal to acquire the shares at C31.5 cents a piece.
BHP responded with its own cash offer of C55 cents and with a minimum acceptance condition of 50 per cent. This was immediately embraced by the Noront board and recommended to shareholders.
Forrest’s higher C70 cents offer, made through his investment company Wyloo, has been structured via, what we know in Australia, as a scheme of arrangement. Thus, it will require shareholder approval of two-thirds of non-Wyloo shareholders.
Electric vehicle car batteries can contain as much as 40 kilograms of nickel.Credit:Bloomberg
If successful Wyloo plans to allow minority shareholders who wish to retain their shares the opportunity to do so.
At the time of writing, Noront’s board had not publicly responded to Forrest’s upwardly revised proposal.
But Forrest’s pitch to shareholders is simple - he is the underdog with the heart and drive to do what bureaucratic companies will take longer to achieve, and he is willing to take others along for the journey. He reminds them of his track record of developing projects in the face of ‘insurmountable odds’.
In the early days of Fortescue, the miner was denied access to BHP’s infrastructure and had to build its own railway and port facilities.
“After years of little progress it’s understandable that shareholders have lost hope in Noront. I’ve personally been in the same position before. Seventeen years ago people told me Fortescue’s deposits would never be mined because there was no infrastructure to access our projects. We proved those critics totally wrong, and we want to do the same thing in the Ring of Fire’, Forrest said on Monday.
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