Kidman (KDR) - World Class Asset + World Class Partner ='s?

Wentworth Securities

KDR has been a roller coaster for the last 12 months. A world class Li discovery, followed by a court case by which they stood to lose their newly discovered assets, then a resounding win at court, then finally a deal with the number one Lithium producer globally in SQM (Sociedad Química y Minera de Chile S.A. NYSE:SQM). We have written about it along the way, thinking the stars would align eventually. The fact that KDR is trading below levels seen during the court case, and ~25% below the highs of the announcement of the SQM JV, presents a significant opportunity to assess what is the first fully integrated Li project to be built in Australia. We can also understand that the register, which was ~80% retail wanted more immediate satisfaction, a takeover or a deal at a higher valuation. However, the choice for KDR was stark; significant capital dilution, and progressing it alone without the experience to take advantage of a world class resource, or funding with a world class partner and having the option to participate where all the margin is, downstream. With a $180m market cap, this value is yet to be realised. (VIEW LINK)


About this contributor

Wentworth Securities

Wentworth Securities

, Wentworth Securities

Wentworth was formed in early 2012 with the goal of providing clients with a client-focused, holistic and transparent approach to investing. We focus on macroeconomic drivers as the primary source of performance. We deliver tailored, actively...

Expertise

No areas of expertise

Comments

Please sign in to comment on this wire.