Category: Stock Market

2021 saw a flurry of mergers and acquisitions amongst ASX shares, making it a record year for listed M&A in Australia.

Some of the biggest moves among ASX shares that you likely followed would include the Santos Ltd (ASX: STO) merger with Oil Search, completed in December.

Or buy now, pay later (BNPL) star Afterpay’s acquisition by global fintech giant Block Inc (ASX: SQ2), approved by shareholders in December.

And how can we forget Sydney Aviation Alliance’s $23.6 billion private takeover bid for Sydney Airport? An acquisition that was completed following court approval in February.

But according to broker Wilsons, 2022 could see even more takeover action among ASX shares.

Records are made to be broken

Wilsons notes that in 2021 10% of the S&P/ASX 200 Index (ASX: XJO) market cap was involved in M&A.

But despite a slow start to M&A in 2022, the broker believes it will still be a strong year for additional takeovers.

Among the reasons we could see another record year for M&A among ASX shares, Wilsons cites pent-up demand for transactions due to COVID delays, topped up by large pools of capital yet to be deployed.

The broker also points to the fact that earnings yields are much higher than corporate borrowing costs, “providing the financial ammunition for M&A transactions”.

According to Wilsons:

Our work highlights that close to 20% of S&P/ASX 100 companies could potentially look financially attractive to an acquirer. Our list of vulnerable names to M&A all generate enough earnings and cash flow that they would effectively be ‘self-funding’ for an acquirer.

Which ASX shares are primed for takeover?

Wilsons applied 3 screening methods to winnow down the ASX shares that look primed for takeover.

Namely:

• Earnings yield (the inverse of the price to earnings (P/E) ratio)
• Free-Cash-Flow (FCF) yield
• Relative share price underperformance

The broker added its own quantitative screen to eliminate ASX shares like BHP Group Ltd (ASX: BHP), which it believes is too big to be an M&A target.

After running the numbers, Wilsons came up with 5 ASX shares that ticked all 3 screens.

First up, personal protective equipment and safety device provider, Ansell Ltd (ASX: ANN).

On Ansell, Wilsons noted:

Significant share price underperformance on a large profit warning suggests structural factors may need to be addressed. Global exposure could fit in with large conglomerate consumables company or PE backed bid.

Also ticking all 3 screens is integrated services provider Downer EDI Ltd (ASX: DOW).

Wilsons commented on Downer:

Valuation misconception, business now more focused following divestments. Structural trends of urbanisation and outsourcing of both private/public services.

The next ASX share primed for a 2022 takeover is global packaging company Amcor PLC (ASX: AMC).

According to Wilsons, Amcor is, “Well run and with an under geared balance sheet vs US peers, with strong FCF yield. Global scale likely to present a barrier.”

Fourth on the list (in no particular order) is toll road operator and developer, Atlas Arteria Ltd (ASX: ALX).

For Atlas, Wilsons said, “Long dated toll road concessions could be vulnerable to private infrastructure asset managers.”

And the fifth ASX share that looks primed for a 2022 takeover is Scentre Group (ASX: SCG), which owns and operates Westfield properties across Australia and New Zealand.

On Scentre Group, Wilsons commented, “COVID-19 impacted earnings – acquirer would have to believe in the future of shopping malls post-pandemic.”

So which ASX shares will invite the first takeover interest?

Stay tuned!

The post 5 ASX shares that could be primed for takeovers in 2022: Wilsons appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Thursday
• Why is the Santos share price sliding today?
• Own ASX 200 energy shares? Here’s the latest on the 2022 crude oil disruptions
• 5 things to watch on the ASX 200 on Wednesday
• Global poster child? Why this fundie is bullish on the Santos share price

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Block, Inc. The Motley Fool Australia owns and has recommended Amcor Limited and Block, Inc. The Motley Fool Australia has recommended Ansell Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Paladin Energy Ltd (ASX: PDN) share price is on ice today amid a capital raise to restart work at a uranium mine.

The uranium miner’s shares were swapping hands for 79 cents apiece before grinding to a halt. In yesterday’s trade, the Paladin Energy share price dropped 0.63%.

So why did Paladin Energy enter a trading halt?

What did Paladin Energy announce?

The Paladin Energy share price was put on hold this morning due to a capital raise. This includes a fully underwritten institutional placement to raise $200 million. A non-underwritten share purchase plan will also take place to garner another $15 million.

New shares will be issued at 72 cents per share, an 8.9% discount on the last closing price of 79 cents. Funds from the capital raise will be used to restart the Langer Heinrich uranium mine in Namibia.

After the equity raise, Paladin expects to have pro forma cash of $259 million with no corporate debt.

Paladin says the equity raise will “de-risk” restarting operations at the mine and will also position the company well for more uranium marketing initiatives.

Paladin entered the trading halt prior to market open today pending the details of the capital raise.

Commenting on the news that’s halted the Paladin Energy share price, company CEO Ian Purdy said.

With the strength of the company’s existing uranium sales offtake with CNNC combined with the recent successful tender award and the continuing strong uranium market fundamentals, Paladin can now confidently work towards a formal commencement of the Langer Heinrich Mine restart project.

The extensive workstreams we have conducted reinforce our confidence in Langer Heinrich as a low risk, robust, long-life operation that is poised to take advantage of the improving uranium market conditions and deliver sustainable value creation for all of our stakeholders

Paladin recently agreed to sell historical mining information for the Agadez Project in Niger to Kopore Metals Limited (ASX: KMT). Shares in the company dropped 7% on 14 March, the day of this announcement.

Uranium sales tender award

Paladin also advised the market today it has received a uranium sales tender award. This will involve supplying uranium concentrates to a subsidiary of US-based Duke Energy Corporation.

The deal, subject to conditions, involves the supply of up to 2.1 million pounds of triuranium octoxide over six years from 2024. Paladin described this tender award as an “important step forward” in returning the Langer Heinrich mine back to production.

Paladin Energy share price snapshot

The Paladin Energy share price has exploded nearly 114% in the past year, while it has lost more than 10% year to date.

For perspective, the benchmark S&P/ASX 200 Index (ASX: XJO) has returned 11% over the past year.

In the past week, Paladin shares have slumped more than 8%, while they have climbed nearly 3% in a month.

Paladin has a market capitalisation of about $2.1 billion based on the current share price.

The post Why is the Paladin Energy (ASX:PDN) share price frozen today? appeared first on The Motley Fool Australia.

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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At lunch on Thursday, the S&P/ASX 200 Index (ASX: XJO) is on course to extend its winning run. The benchmark index is currently up 0.35% to 7,540.6 points.

Here’s what is happening on the ASX 200 today:

Tabcorp demerger update

The Tabcorp Holdings Limited (ASX: TAH) share price is pushing higher today after the release of a demerger update. The gambling company intends to spin off its lotteries business and retain its wagering businesses. Shareholders will be given one new share in the lotteries business for every Tabcorp share they own. The Tabcorp board determined that the demerger is the most certain and timely path, with lower regulatory impediments, to maximise value for shareholders.

Mining shares storm higher

It has been a great day for ASX 200 mining shares such as BHP Group Ltd (ASX: BHP) and South32 Ltd (ASX: S32). Thanks to a decent rise in base metal prices during overnight trade, these mining giants are recording solid gains and helping to drive the S&P/ASX 200 Resources index 2% higher at lunch.

Tech shares slump

Things haven’t been anywhere near as positive in the tech sector today. A poor night of trade on the tech-focused Nasdaq index has led to the S&P ASX All Technology index falling 1% today. Among the worst performers in the sector have been Block Inc (ASX: SQ2) and Xero Limited (ASX: XRO) shares, which are down 4% and 3%, respectively, at lunch.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Thursday has been the Champion Iron Ltd (ASX: CIA) share price with a 4.5% gain following a strong night for base metals. The worst performer has been the Harvey Norman Holdings Limited (ASX: HVN) share price with a 6% decline after trading ex-dividend.

The post ASX 200 (ASX:XJO) midday update: Tabcorp demerger update, BHP higher, Block tumbles appeared first on The Motley Fool Australia.

More reading

• Here’s why the Harvey Norman (ASX:HVN) share price is slipping today
• Are these ASX 200 mining shares in trouble?
• The BHP share price is up 4% and close to a record high
• Tabcorp (ASX:TAH) share price higher following $10b demerger update
• 2 ‘very interesting’ ASX shares to buy now as ASX 200 roars back

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Block, Inc., Harvey Norman Holdings Ltd., and Xero. The Motley Fool Australia owns and has recommended Block, Inc., Harvey Norman Holdings Ltd., and Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Shares in Magellan Financial Group Ltd (ASX: MFG) are sinking today and now trade around 1% lower at $16.16 apiece.

Investors continue selling Magellan shares today despite the fund manager announcing a fairly important update.

Magellan is now trading at a deep discount relative to the benchmark S&P/ASX 200 Index (ASX: XJO). The spread of this gap continues to widen in 2022.

It also trails the S&P/ASX 200 Financials Index (XFJ) by a similar amount over the past 12 months.

What did Magellan announce?

Magellan says its board has decided to proceed with a “pro rata non-renounceable bonus issue of options to eligible shareholders”.

The issue is for nil consideration, in other words, at no extra cost to shareholders.

Hamish McLennan, Magellan’s Chairman, said the options could be a value-add to investors – a welcomed call in such dire times for the stock.

“We believe the bonus issue of options at no cost to shareholders, and the $35.00 exercise price and 5-year term, provides a potential source of value for our shareholders,” McLennan remarked.

The firm notes its decision is in line with language in its interim results on 18 February, forming part of its capital management strategy.

“Eligible shareholders will receive one (1) Option for every eight (8) shares held at 5:00 pm (AEST)
on 7 April 2022,” Magellan noted.

“Each Option will provide shareholders with the right – but not the requirement – to purchase one Magellan share at an exercise price of $35.00 per Option, expiring on 16 April 2027,” it added.

The issuance will trade under the ticker “MFGO” if successfully quoted by the ASX, and is expected to be issued on 14 April, per the release. A prospectus will follow to shareholders on 21 April.

Magellan share price summary

It’s been a difficult time for Magellan shareholders of late, with 24% erased in value since trading resumed in 2022, and a 77% loss over the past 12 months.

The post Magellan (ASX:MFG) share price dips despite free gift bonanza appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Air New Zealand Limited (ASX: AIZ) share price is nosediving on Thursday after the company announced a NZ$1.2 billion (A$1.1 billion) rights offer.

The offer is part of a NZ$2.2 billion ($A2.04 billion) ‘recapitalisation package’ announced to the market after yesterday’s close.

The Air New Zealand share price was put on ice yesterday as whispers of the raise spread through the market.

The airline’s stock was defrosted this morning. At the time of writing, it’s trading for $1.18, having plunged 7.42%.

However, that’s an improvement on the stock’s early morning performance. The Air New Zealand share price plunged to a 52-week low of $1.09 just after the ASX opened, representing a 15.6% fall.

Let’s take a closer look at the news weighing on the Kiwi airline’s stock today.

Why is the Air New Zealand share price tumbling?

The Air New Zealand share price is plummeting on news of a major capital raise. The raise will see new shares offered for 49 Australian cents apiece – a discount of approximately 62% on the company’s previous close as part of a rights offer.

Approximately 2.2 billion new shares will be issued under the offer, representing around 200% of the company’s outstanding shares.

Eligible shareholders will have the opportunity to purchase two new shares in the airline for every share they already own.

Additionally, around NZ$600 million (A$557.4 million) worth of new shares will be issued to the Crown to maintain its 51% stake in the company.

That’s on top of a NZ$400 million (A$371.6 million) four-year Crown loan secured by the company. Though, it’s not intending to draw on that debt facility.

NZ$850 million (A$789.64 million) of the cash raised will be used to repay an existing Crown loan.

Another NZ$950 million (A$882.54 million), minus transaction costs, will boost the airline’s balance sheet, improve its liquidity, and position it for recovery.

Air New Zealand chair Dame Therese Walsh said:

While there will still be bumpy skies ahead over the next few years, the moment is right for Air New Zealand to raise equity, recapitalise its balance sheet, and repay the loan it received from the Crown during the COVID crisis. This is an important step in refuelling for our recovery.

Financial year 2022 guidance upgrade

The airline has also released news that might be helping the Air New Zealand share price today.

It has upgraded its financial year 2022 guidance.

Previously, Air New Zealand told ASX investors that it was expecting to report a loss before tax and significant items of more than NZ$800 million (A$743.19 million) in FY22.

Now, after the New Zealand Government announced its plan to open the nation’s borders, the airline expects a pre-tax loss of less than NZ$800 million.

However, it predicts losses will continue beyond this financial year.

Air New Zealand share price snapshot

The Air New Zealand share price has had a rough trot in 2022 so far.

As of its previous close, it had tumbled nearly 10% year to date. Today’s drop included, it’s fallen 17% this year.

It’s also nearly 25% lower than it was at this time last year.

The post Air New Zealand (ASX:AIZ) share price plummets on confirmation of NZ$2.2b ‘recovery’ cap raise appeared first on The Motley Fool Australia.

More reading

• Air New Zealand (ASX:AIZ) share price drops then stops amid NZ$1.2bn cap raise rumblings
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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Siren Gold Ltd (ASX: SNG) share price is rocketing higher on Thursday.

At one stage today, the gold explorer’s shares were up as much as 49% to a 52-week high of 52 cents.

The Siren Gold share price has pulled back a touch since then but remains up 27% to 44.5 cents currently.

Why is the Siren Gold share price rocketing higher?

Investors have been bidding the Siren Gold share price higher today following the release of an update on exploration activities.

According to the release, diamond drillhole AX84 intersected significant visible gold in the deepest hole drilled to date at its Alexander River project. This “spectacular” strike extends the McVicar West shoot to ~ 500m down plunge and the shoot remains open at depth.

How good is this drilling result?

The release notes that RSC Consulting tracks drillhole intersections for companies listed on the Australian Stock Exchange.

RSC has advised that drillhole AX84 would rank just outside the top 10 for ASX listed companies in 2021 when all metals are considered but would rank in the top 10 for gold. In 2022 year to date, AX84 currently ranks as the third best gold intersection.

Siren’s Managing Director, Brian Rodan, was very pleased with the news and believes it demonstrates the potential of the Alexander River project. He said:

“It is certainly very gratifying for the Company and the Siren Gold Site Team to achieve a spectacular bonanza hit in AX84, as it is not often that you see a 2.5m @ 11.5 oz / t intersection in the modern era.

The Company believes this intersection provides additional credence to our long-held belief that the deeper we drill at Alexander River the more visible gold we will intersect and the same holds true for our Big River, St George, and Lyell projects.

Siren Gold is currently progressing a significant amount of work at its Reefton gold project and with the commencement of our third rig at Big River the company certainly looks forward to exciting times ahead on our virtually untouched Reefton Goldfield tenement package.”

The post ‘Spectacular strike’: Why this ASX gold share is rocketing 49% higher appeared first on The Motley Fool Australia.

More reading

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Investors are expecting significant dividends in 2022 from two particular ASX dividend shares.

Companies have the ability to declare large dividends for shareholders. Dividends are paid from previous profits generated, so they can provide cash returns in periods of market volatility.

These two ASX dividend shares are expected to pay large dividend yields in FY22, according to experts:

New Hope Corporation Limited (ASX: NHC)

New Hope is one of the largest coal miners in Australia. It’s currently benefiting from high coal prices.

It’s currently rated as a buy by the broker Morgans, with a price target of $3.40. Morgans was impressed by the recent FY22 half-year result, which included a much bigger-than-expected dividend.

The broker thinks the high coal prices will help the cash flow and the dividend in the second half.

In that half-year result, this ASX dividend share said the realised price for its coal was 147% higher. Operating cash flow was 626% higher to $453 million and underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) rose 583% to $554 million.

New Hope grew its interim dividend by 325% to 17 cents per share and also declared a special dividend of 13 cents per share.

Morgans thinks the New Hope share price offers a grossed-up dividend yield of 21% in FY22 and then 17% in FY23.

At the time of writing, the New Hope share price is up 2.09% at $3.42.

Adairs Ltd (ASX: ADH)

Adairs is one of the country’s largest retailers of homewares and furniture. It operates three different businesses: Adairs, Mocka, and Focus on Furniture.

In the first half of FY22, Adairs suffered from the COVID-19 impacts of closed stores. Despite that setback, this ASX dividend share still managed to achieve growth in a number of non-financial areas that could help profit grow into the long-term.

Adairs said that growing store floor space through new and up-sized stores will continue to drive store sales. In the 12 months to December 2021, Adairs store floorspace increased 8.6%.

Management also explained that Linen Lover membership growth is a key driver of sales. Linen Lover members account for more than 80% of total Adairs sales and spend around 1.5x more than non-members with each transaction. Each new member reportedly adds around $400 of total sales. It aims to grow memberships by at least 10% per annum. In the 12 months to December 2021, the membership total rose 10% and it’s getting close to one million members.

The ASX dividend share also recently acquired Focus on Furniture and its national distribution centre is now operational.

It’s currently rated as a buy by Morgans, with a price target of $3.50. Morgans thinks the business has good potential.

Morgans thinks Adairs is going to pay a grossed-up dividend yield of 9% in FY22 and 12.3% in FY23.

In morning trading today, the Adairs share price is down 0.5% at $2.995.

The post 2 ASX dividend shares expected to have BIG yields in 2022 appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended ADAIRS FPO. The Motley Fool Australia owns and has recommended ADAIRS FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Harvey Norman Holdings Ltd (ASX: HVN) shareholders might be wondering why the share price has fallen 5.08% to $5.42 today.

Not to worry, the shares have simply gone ex-dividend. That means any ASX investor who buys them today or in the future won’t be eligible to receive the upcoming interim dividend.

Historically, when a company reaches its ex-dividend day, its shares tend to fall in proportion to the dividend paid out. This is because some investors sell off their shares after securing the dividend.

Shareholders set eyes on Harvey Norman’s interim dividend

The multinational retailer released its half-year results on 25 February, reporting mixed numbers across key financial metrics.

Nonetheless, the board opted to maintain its interim dividend at the same level as last year.

When can shareholders expect to be paid?

For those eligible for Harvey Norman’s interim dividend, shareholders will receive a payment of 20 cents per share on 2 May.

The dividend is fully franked at a tax rate of 30%, which means investors can expect to receive tax credits.

Harvey Norman share price summary

Since the beginning of 2022, Harvey Norman shares have gained almost 10% on the back of positive investor sentiment.

The S&P/ASX 200 Index (ASX: XJO) is up around 1.4% over the same timeframe.

Harvey Norman shares reached a 52-week low of $4.57 in late January, before zooming upwards in the months following.

Based on today’s price, Harvey Norman commands a market capitalisation of roughly $6.75 billion. It has a trailing dividend yield of 6.46%.

The post Here’s why the Harvey Norman (ASX:HVN) share price is slipping today appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• ‘Popping the champagne’: ASX retail shares leap following budget consumer handouts
• Could these ASX shares get a boost from tonight’s federal budget?
• Leading brokers name 3 ASX shares to buy today
• Hoping to bag the Harvey Norman (ASX:HVN) dividend? Here’s what you need to do this week

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Harvey Norman Holdings Ltd. The Motley Fool Australia owns and has recommended Harvey Norman Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

Today’s price action in the overall cryptocurrency market is generally bearish. Ethereum (CRYPTO: ETH) and Dogecoin (CRYPTO: DOGE) have dropped 2.1% and 3.2%, respectively, over the past 24 hours as of 11 a.m. ET. These moves appear to be driven by the high-profile hack of Ethereum sidechain Ronin, a significant development in both the size and scale of this heist. Dogecoin is doing what it does best, providing a high-volatility vehicle for investors to trade short-term market movements. 

Convex Finance (CRYPTO: CVX) has seen a larger drop of 4.4% over the same time frame, driven by what appears to be profit taking, following a rather dramatic rise over the past couple weeks. Convex Finance has seen its CVX tokens approximately double since mid-March on bullish expectations around this network’s ability to boost staking returns on Curve Finance pools, as well as new incentives for veCRV holders. 

So what

It’s important to keep these recent 24-hour moves for these tokens in the context of some rather impressive upside moves over the past couple of weeks. Most investors would agree that some profit taking is healthy for these tokens to resume their long-term march higher. Accordingly, perhaps there’s nothing to see here, at least for investors with a perspective that’s longer than 24 hours.

That said, this significant hack of an Ethereum sidechain may cause investors some concern. Security issues remain a key talking point for crypto bears, who are likely emboldened by this news today.

Now what

It remains to be seen whether the crypto market will brush off this hack, as it has done with the previous $320 million hack of the Solana Wormhole bridge in February. 

However, investors looking at the crypto sector as a safe place to park funds for the long term are being reminded today of some of the (potentially expensive) growing pains that can impact investor portfolios in the near term. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Why Ethereum and Dogecoin are dropping today appeared first on The Motley Fool Australia.

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Chris MacDonald owns Ethereum and Solana. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Ethereum and Solana. The Motley Fool Australia owns and has recommended Ethereum. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Shares in Pilbara Minerals Ltd (ASX: PLS) are lifting today following the release of a company announcement.

At the time of writing, the Pilbara Minerals share price is trading at $3.24 after spiking 18% in the last month of trade.

Next rung on the ‘mid-stream’ ladder?

Pilbara advised it has completed a scoping study as part of its “mid-stream value-added lithium growth strategy” alongside Calix Limited (ASX: CXL).

Lycopodium Minerals Ltd (ASX: LYL) actually conducted the study, that Pilbara says will give support to technical aspects of its Pilgangoora Operation in WA.

The study’s findings confirm the technical capability of Pilbara’s flowsheet, capable of producing lithium phosphate salt using flotation spodumene concentrate from Pilgangoora.

“The Scoping Study is the first economic evaluation of the Mid-Stream Project which has been prepared to an accuracy level of +/-40% (for Capital costs) and +/-30% (for Operating costs),” it remarked.

“It represents a preliminary study of the potential technical and economic viability of the proposed process path and demonstration scale facility development”.

The release also stated that all progress will move ahead as apart of a proposed joint venture with Calix, with more definitive studies to start that journey.

What’s next?

The company expects to complete a number of milestones by the end of 2022, particularly around joint-venture development and cost optimisation, it says.

This should take place in the form of more definitive and engineering studies, Pilbara notes, “to further assess the operating and capital costs for the Demonstration Plant.”

Each of these moves will guide both Pilbara and Calix to a final investment decision on the site, aiming to commercialise its mid-stream technology across the global industry.

If all goes according to plan, the plant’s construction could start as early as 2023, with completion penciled for Q1 CY2024, Pilbara says.

“Following completion of construction and commissioning, a period of process optimisation
would follow”.

In the last 12 months the Pilbara Minerals share price has soared over 209% and is now trading 4% higher for the week.

The post Here’s why the Pilbara Minerals (ASX:PLS) share price is spiking today appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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