If the condition of the iron-ore industry were as bad as jbog imagines, we would not be seeing takeover bids at a premium such as this one for Northern Iron:
Northern Iron Ltd. said Monday it has received an initial takeover proposal from Swiss-based trading house Prominvest AG worth 525 million Australian dollars ($550 million), which is higher than an earlier A$518 million cash bid from India’s Aditya Birla Group… Aditya Birla sweetened its offer to A$1.40 a share earlier this month, prompting Northern Iron to agree to open its books to the Indian group.
…Northern Iron is currently producing around 2.1 million metric tons a year, but aims to reach its 2.8 million-tons-a-year nameplate capacity soon, and double concentrate production to 5.6 million tons annually by 2016 at a cost of up to $360 million.
“The efficient-market hypothesis may be the foremost piece of B.S. ever promulgated in any area of human knowledge!”
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.