The Tilt Renewables Ltd (ASX: TLT) share price is flying high today after the wind and solar farm owner and operator announced it’s set to be sold off to two separate parties.

Wind of the potential acquisition hit the Australian Financial Review yesterday. The news stated that Tilt Renewables was in the late stages of discussions with Mercury NZ and QIC’s renewable investment group, Powering Australian Renewables (PowAR).

Tilt Renewables board tells ASX they’re all for it

In the announcement provided to the market, the Tilt board has recommended the proposed acquisition. This would entail Mercury NZ acquiring Tilt’s New Zealand operations, while PowAR would acquire the company’s Australian operations. The offer from the consortium is set at NZ$7.80 per share in cash to Tilt shareholders.

The proposal comes just over a month after the renewable infrastructure owner received an initial non-binding indicative proposal to acquire it in early February. At the time, Infratil Ltd (ASX: IFT), Tilt’s largest shareholder, welcomed the proposal. Tilt went on to offer access to information to these companies to carry out due diligence.

Today’s scheme has been fully endorsed by Infratil, as the company agrees to vote its entire 65.5% shareholding in favour of the acquisition.

Based on the current number of outstanding shares, the acquisition price of roughly $7.24 Australian dollars gives Tilt Renewables a market capitalisation of $2.73 billion. If all parties move forward with the deal it would mark the largest renewables deal ever in Australia and New Zealand.

What it means for other ASX listed parties

Today’s news is certainly good for Infratil as well. The foreign investment company provided an update making its support for the acquisition known.

Furthermore, Infratil noted that the carrying value of its stake in Tilt was NZ$704.1 million at the end of September 2020. Hence, the sale price mentioned today represents over four times its book value.

AGL Energy Limited (ASX: AGL) also announced that it will be involved in the acquisition of Tilt due to its 20% interest in PowAR. As a result, AGL will contribute A$341 million towards funding PowAR’s portion of the purchase.

The CEO of AGL, Mr Brett Redman. commented on the update:

The proposed acquisition by PowAR will provide more renewable energy options in AGL’s generation portfolio, further supporting our orderly transition away from coal-fired power and responding to our customers’ increasing appetite for cleaner energy

Tilting towards green

It’s no secret there is a strong push for renewable energy across Australia and New Zealand. Last week’s news of Victoria’s Yallourn power station bringing forward its closure by four years is a sign of the times. As more legacy energy infrastructure assets falter, more renewables will be needed to meet the public’s energy needs. 

Today’s news demonstrates how sought-after renewable infrastructure is becoming. As Tilt Renewables mentioned, the scheme represents a 40% per annum return to any shareholder who invested in the company upon its demerger in 2016. In the past year alone, Tilt shares have been a standout on the ASX, returning 156%. 

At the time of writing, the Tilt Renewables share price is trading 15.36% higher at $7.06.

More reading

• Goldman reaffirms its conviction buy on this ASX share on Yallourn shutdown
• The 3 highest paying ASX 200 dividend shares
• Tilt Renewables (ASX:TLT) share price falls despite wind farm news
• Amaysim (ASX:AYS) share price higher as company moves to delist

Motley Fool contributor Mitchell Lawler 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 Creso Pharma Ltd (ASX: CPH) share price has slipped in afternoon trading today after the company announced an agreement to acquire Halucenex Life Sciences Inc.

The Creso Pharma share price lifted as high as 23 cents just after the market opened this morning as the agreement provides entry into the emerging global market for psychedelic medicines, estimated to be worth up to US$100 billion. Halucenex researches, develops and licences novel psychedelic molecules for the global pharmaceutical and nutraceutical markets. 

However, Creso shares are currently down 1.43%, trading at 20.7 cents at the time of writing. Let’s take a look at what’s happening with the Creso Pharma share price. 

Consolidating after 1,000% surge last year 

The Creso Pharma share price surged as much as ~1,300% last year from 3.5 cents to as high as 47 cents.

This could be attributed to the US House of Representatives passing the Marijuana Opportunity Reinvestment and Expungement Act to remove cannabis from the US Controlled Substances Act. The bill decriminalises cannabis for the first time on a national level. 

While the Creso Pharma share price has taken a breather around the 20 cent level in 2021, the company continues to push forward with several significant announcements and developments in the cannabis space.  

Halucenex acquisition 

Creso said the acquisition was a “first-mover advantage” into the psychedelic medicines sector, positioning itself as the first 100%-owned psychedelic medicines company listed on the ASX. 

Halucenex is currently awaiting the approval of its Controlled Drugs and Substances Dealer’s License. If approved, it will apply to commence a phase 2 clinical trial. The company will conduct research and development on psychedelic substances, including LSD, psilocybin and MDMA. Its phase 2 clinical trial is expected to commence in the third quarter of 2021. 

Halucenex will also seek an amendment to the dealer’s license to produce, package/assemble, sell, transport, import and export psychedelic substances. The company notes that it will not partake in any activities in relation to certain compounds until the company has satisfied the ASX that it is legally compliant. 

Transformational acquisition for the Creso Pharma share price 

Creso Pharma views the acquisition as “transformational”, enabling the company to emerge as a “best-in-class provider of cannabis, cannabinoids and psychedelics alternative medicines to meet the large unmet need for treatments to improve mental health and well being”. 

The Halucenex acquisition will include a $500,000 cash consideration plus ~29.25 million Creso shares and ~17.5 million Creso performance shares. Creso has also agreed to advance Halucenex $250,000 as a loan to fund its operations before settlement. And provide another $1,000,000 in funding during the 12 months following settlement. 

Management commentary

Creso Pharma non-executive chairman Adam Blumenthal believes the acquisition benefits the company on all fronts.

This is a major milestone for Creso Pharma and marks our evolution into a broader based pharmaceutical business. Creso will now sell its trusted cannabis products and progress the commercialisation of a range of psychedelic-assisted psychotherapy treatments. Our entry into this market provides the company with another lucrative vertical and an additional near term revenue stream.

Mental health and PTSD are becoming detrimental to our society and this has been highlighted in the last 12 months. These conditions have been exacerbated by COVID-19 and the available treatments are shown to have limited effectiveness and many side effects. Psychedelic-assisted therapy is a new alternative treatment route, which has considerable promise.

Mr Blumenthal said the acquisition of Halucenex would strengthen the company’s presence in Canada, as well as “provide a number of opportunities in drug development which will inevitably lead to further new market entries and commercialisation opportunities”.

More reading

• The Creso (ASX:CPH) share price fizzles despite new distribution deal

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The Bank of Queensland Limited (ASX: BOQ) share price is trading lower on Monday afternoon.

At the time of writing, the regional bank’s shares are down 1% to $8.79.

Why is the Bank of Queensland share price trading lower?

This morning Bank of Queensland announced the completion of the retail component of its underwritten 1 for 3.34 accelerated pro-rata non-renounceable entitlement offer.

According to the release, the completion of the retail entitlement offer represents the final stage of the bank’s $1.35 billion equity raising. This included an underwritten institutional entitlement offer and institutional placement, which completed last month.

These funds were raised at $7.35 per new share, which was a 12.6% discount at the time.

Bank of Queensland revealed that it received strong support from eligible retail shareholders. It advised that applications totalled approximately $336 million, reflecting a take-up rate of approximately 50%.

In addition to this, approximately $72 million was applied for under its oversubscription facility, with each eligible retail shareholder who subscribed under the facility receiving the full allocation of new shares for which they applied.

However, this meant that the company only raised a total of $408 million from retail shareholders, which was below target. In light of this, 37 million (worth ~$271 million) will be allocated to the underwriters or sub-underwriters of the retail entitlement offer.

These underwriters are likely to be looking to offload these shares onto the market in the coming weeks, which could weigh on the Bank of Queensland share price.

What now?

With the funds raised, Bank of Queensland will now push ahead with its acquisition of Members Equity Bank (ME Bank) for $1.325 billion.

This acquisition is expected to be low double-digit to mid-teens cash earnings per share accretive, including full run-rate synergies in the first year (FY 2022). It is also expected to be cash return on equity accretive by over 100 basis points including full run-rate first year synergies.

The two businesses will have pro forma total assets over $88 billion, with total deposits of more than $56 billion.

More reading

• Wilson Asset Management thinks these 2 ASX shares are a buy
• Bank of Queensland (ASX:BOQ) share price rises as it inks office deal with AMP (ASX:AMP)
• Top brokers name 3 ASX shares to buy today
• Why the Bank of Queensland (ASX:BOQ) share price is up 10% to a 52-week high
• ASX 200 flat: SEEK CEO exits, Afterpay sold off, BOQ surges higher

Motley Fool contributor James Mickleboro 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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More reading

• Here’s why the Altech (ASX:ATC) share price is rocketing 11%
• Why brokers think the Qantas (ASX:QAN) share price could fly 17% higher
• Why Afterpay, Fortescue, GWA, & Jupiter Mines are dropping today
• Why the Jindalee (ASX:JRL) share price is up 11% today
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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Kate O’Brien owns shares of Apple and Rio Tinto Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares), Alphabet (C shares), and Apple. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), and Apple. 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 Altech Chemicals Ltd (ASX: ATC) share price is flying higher today, up 10.9% at 6.1 cents at the time writing, having earlier posted gains of more than 16%.

We take a look at the tech share’s twin announcements to the ASX below.

Battery performance

First, Altech reports that it has completed its phase 1 testing of battery performance of “graphite particles coated with high purity alumina (HPA)”. The coating was done with Altech’s proprietary technology. The trial included 100 cycle battery tests.

The company said that the performance met its expectations, and it plans additional tests to demonstrate repeatability. The graphite particle coating has the potential to increase the capacity, chargeability and life of lithium-ion batteries.

Commenting on the initial results, Altech general manager operations Jingyuan Liu said:

We now have to optimise the testing conditions and conduct additional tests to demonstrate repeatability and consistency. The performance of the alumina coated graphite is meeting our expectations so far.

Silica alumina coating breakthrough

In Altech’s second announcement, the company reported a breakthrough in its silicon alumina coating development.

The company said it had successfully applied its “alumina nanolayer coating technology to the coating of silicon particles, typical of those used in anode applications within lithium-ion batteries”.

Altech noted silicon has 10 times more energy capacity than graphite and pointed to Tesla Inc‘s (NASDAQ: TSLA) recently announced intent to increase the amount of silicon in its batteries to improve battery life and energy density.

Addressing the breakthrough, Jingyuan Liu said:

We are very encouraged by the excellent coating results achieved from the application of our technology, it has the potential to significantly increase the use of silicon in lithium-ion battery anode and consequently the potential to increase battery energy density, overall performance and longevity.

The next step is to further optimise the coating process.

Altech share price snapshot

Over the past full year, the Altech share price is up 3%. That compares to a 38% gain on the All Ordinaries Index (ASX: XAO).

Year-to-date Altech shares have gained 55%.

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Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Tesla. 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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ASX travel shares took the spotlight last week after the federal government announced a $1.2 billion support package that includes 800,000 half-priced airline tickets. The Qantas Airways Limited (ASX: QAN) share price rose 4% last week on the back of the positive news.

Qantas shares have also attracted multiple broker upgrades as the airline is expected to emerge as a leaner business post-COVID. 

Brokers upgrade the Qantas share price to a Buy

Macquarie Group Ltd (ASX: MQG) is the latest broker to upgrade the Qantas share price. On Monday, the broker shared its views that Qantas will emerge from the pandemic as a structurally improved business with a focus on the more attractive domestic market and its loyalty business. 

Macquarie believes that the improvement in domestic travel, and Qantas’ leading loyalty program, will reduce the downside risks associated with international travel. The broker stated that a vaccine rollout combined with border policies and government stimulus could see domestic capacity push to above pre-COVID levels in the near term. 

The broker also expects vaccine rollouts in key international destinations to be largely completed by the end of 2021. However, the timing surrounding when international travel will recommence remains uncertain. 

Macquarie upgraded the Qantas share price from neutral to outperform with a $6.35 target price, which represents an upside of ~17% on today’s price. 

Citi and Ord Minnett also upgraded their targets for the Qantas share price last week. 

On 12 March, Citi upgraded the Qantas share price to a Buy with a $6.14 target price. The broker believes the government stimulus packages add greater certainty for borders. Citi’s comments did note, however, that a leisure-led recovery would deliver negligible upside for profitability.

On 10 March, Ord Minnet upgraded the Qantas share price target to $6.00 with a Buy rating. The broker believes Qantas will emerge from COVID with a significantly reduced cost base and an enhanced competitive position.  

ASX travel shares higher on Monday 

The S&P/ASX 200 Index (ASX: XJO) is trading slightly higher on Monday, up 0.06% at the time of writing. However, ASX travel shares are grinding comparably higher across the board. As well as Qantas, which is currently up 2.6% at the time of writing, these include: 

• Flight Centre Travel Group Ltd (ASX: FLT) up 0.86% 
• Webjet Limited (ASX: WEB) up 0.99% 
• Corporate Travel Management Ltd (ASX: CTD) up 2.66% 

More reading

• Top brokers name 3 ASX shares to buy next week
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Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited and Webjet Ltd. The Motley Fool Australia has recommended Flight Centre Travel Group Limited. 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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In afternoon trade the S&P/ASX 200 Index (ASX: XJO) is fighting hard to get into positive territory but has just fallen short. The benchmark index is currently down slightly to 6,763.1 points.

Four ASX shares that are falling more than most today are listed below. Here’s why they are dropping:

Afterpay Ltd (ASX: APT)

The Afterpay share price is down 4% to $109.00. Investors have been selling Afterpay and other tech shares on Monday after bond yields widened on Friday night. The US 10-year treasury bond hit a one-year high of 1.625%, leading to tech stocks on the Nasdaq index tumbling lower. The S&P/ASX All Technology Index (ASX: XTX) is down 1.25% at the time of writing.

Fortescue Metals Group Limited (ASX: FMG)

The Fortescue share price has fallen 4% to $20.43. Investors have been selling the iron ore producer’s shares on Monday following another pullback in the price of the steel-making ingredient on Friday night. According to CommSec, the benchmark iron ore price fell by US$5.35 a tonne or 3.1% to US$165.70 a tonne.

GWA Group Ltd (ASX: GWA)

The GWA share price has dropped 6% to $2.83. This follows news that the buildings products company’s shares will be kicked out of the ASX 200 index at the next rebalance. GWA is one of six companies that will be removed from the illustrious index on 22 March.

Jupiter Mines Ltd (ASX: JMS)

The Jupiter Mines share price has tumbled 7% to 30.7 cents. This morning the manganese mining company announced that the demerger and initial public offering of its Juno Minerals business will still go ahead, but on a delayed timetable. As a result, a general meeting of Jupiter shareholders will be held by the end of April to re-approve the capital reduction and demerger. The process is now expected to complete in May.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T 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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Lithium miner Jindalee Resources Limited (ASX: JRL) shares are rocketing today, reaching a high of $1.82 in early trade.

After coming out of a trading halt, the company announced more lithium discoveries at one of its sites. The company’s shares had been placed in a voluntary suspension on Friday in anticipation of a $9 million capital raising endeavour. 

This follows the Jindalee share price being placed in a trading halt last Wednesday.

At the time of writing, shares in the mineral exploration company have retreated slightly to $1.70, up 11.4%.

What did Jindalee announce?

In today’s release, Jindalee gave an update on progress at its McDermitt lithium project in Nevada. The company advised that the site, which is 100% owned by Jindalee, has “significant zones of lithium mineralisation”.

In 2 of the 4 drill holes, Jindalee discovered mineral ores that were more than 55 metres thick. In one case, the ore was 70 metres thick. All ores discovered had in excess of 1000 parts per million (ppm) of lithium, well above the 100ppm minimum required for commercially viable ore. 

The miner said the ore was discovered in relatively shallow spots which bodes well as greater mineral abundance can be found deeper in the earth’s crust.

The company expects to drill another 6 holes at the site soon. It initially planned to drill the holes last year but the coronavirus pandemic delayed operations.

Jindalee will hire an independent consultant to give a higher mineral resource estimate than provided previously.

In addition, the company will use the planned $9 million in capital to fund an expansion of its McDermitt lithium mine as well as gold and nickel mines in Western Australia. Jindalee will issue 6 million new shares at a price of $1.50 each.

Lithium is fast becoming a valuable commodity

Demand for lithium is booming as the world moves away from fossil fuels and towards renewable energy and battery storage. For example, last year total car sales decreased by 43% but electric car sales increased by 20%. A key element in electric vehicle battery manufacturing is lithium.

The third element’s price in the commodity market also rocketed 20.6% in one day to reach US$85,000 a tonne. Over 12 months, its price has gone up by 82.8%.

Jindalee share price snapshot

This time last year, shares in Jindalee were trading at 31.5 cents each. Since then, the share price has accelerated 354.6% to sit at its current price. Many lithium miners share prices are on a similar trajectory.

Jindalee Resources has a market capitalisation of $79.3 million.

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Motley Fool contributor Marc Sidarous 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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Vmoto Ltd (ASX: VMT) shares are rocketing in early-afternoon trade following the company’s announcement it has signed a strategic memorandum of understanding (MoU). At the time of writing, the Vmoto share price has risen to 47 cents, up an astonishing 14.63%.

Let’s take a look at what’s driving the electric-powered scooter manufacturer’s shares higher.

What did Vmoto announce?

The Vmoto share price is racing higher as investors weigh the potential market opportunity from the company’s latest update.

According to its release, Vmoto has entered an MoU with one of India’s largest travel technology companies, the Bird Group.

The MoU will see Vmoto work towards granting Bird Group an exclusive distribution agreement in India. This will involve the export of Vmoto’s two-wheel electric vehicle products, the CUX, and its newest line-up, the CUmini model.

Bird Group will purchase 20 units of the CUmini model to take part in a trial. In further news boosting the Vmoto share price, this will see Bird Group set up in pole position to bid for a government-led ride-sharing project in New Delhi, India.

Should all go to plan, Bird Group will purchase a minimum amount of 10,000 units within the first year. This would generate revenue for Vmoto of around $13.8 million for the initial order alone.

The electric vehicle market for India is expected to significantly increase over the next several years, with consumers opting for clean and sustainable mobility. In a research piece from arizton.com, the Indian two-wheel vehicle market size is forecast to reach US$750 million by 2025. Over a 9-year period from 2011 to 2020, statistics showed that internal combustion engine (ICE) two-wheeler sales in India hit 162.2 million units.

The Indian Government is known to strongly support consumers adopting the use of electric vehicles as opposed to ICE two-wheelers. Considered a more environmentally friendly alternative, current policies enacted have aimed to accelerate the transition to their use. These include subsidies, stringent emission regulations and the proposed banning of ICE two-wheel vehicles.

What did the managing director say?

Vmoto’s managing director Mr Charles Chen commented:

We identified Bird Group as an ideal partner for Vmoto within the Indian market, due to the size and scale of its reach and operations.

We have been in discussions with Bird Group for quite some time and are confident this MOU represents the first step in establishing a long-term successful business relationship. India is a market we have been researching heavily over the last 12 months and we believe our expansion into this market will be a tremendous success, with the potential to deliver exceptional growth over the coming years.

About the Vmoto share price

The Vmoto share price has gained more than 190% over the last 12-months. Year to date, the company’s shares have lifted by around 9%.

Based on the current share price, Vmoto commands a market capitalisation of around $114 million.

More reading

• Vmoto (ASX:VMT) share price slips despite positive update

Motley Fool contributor Aaron Teboneras 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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What do brokers think of the BHP Group Ltd (ASX: BHP) share price? Could the big Australian resource giant be a buy right now?

Was the recent report strong?

BHP’s underlying numbers included double digit growth for many statistics.

Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) rose by 21% to US$14.7 billion and underlying attributable profit went up 16% to US$6 billion.

Profit from operations grew by 17% to US$9.75 billion and net operating cash flow increased by 26% to US$9.37 billion.

However, attributable profit fell 20% to US$3.9 billion. This included an exceptional, one-off loss of US$2.2 billion predominately relating to the impairments of New South Wales Energy Coal (NSWEC) and associated deferred tax assets, as well as Cerrejon.

Free cash flow of US$5.2 billion reflected higher iron ore and copper prices, along with strong operational performance. This cashflow helped net debt improve by 7% to US$11.8 billion.

The interim dividend was increased by 55% to US$1.01.

BHP CEO Mike Henry provided some commentary about this result, he said:

We further grew value in the business during the half through achieving first production at the Spence Growth Option and through the acquisition of an additional interest in Shenzi. Our other major projects in iron ore, petroleum and potash are progressing to schedule.

Creating and securing more options in future facing commodities remains a priority. In nickel and copper, we have established further partnerships, acquired new tenements and progressed exploration.

What has the BHP share price done recently?

BHP shares have risen alongside the strength of the commodity market, particularly iron ore, over the last year. 

Over the last six months the BHP share price has gone up by around 27%. However, it has actually dropped by 7% since 3 March 2021.

What do brokers think of the BHP share price?

Brokers are a bit mixed about the big resources company. For example, Morgans has a share price target of $42.20 for the company, whereas Macquarie Group Ltd (ASX: MQG) has a price target of $55.

Macquarie thinks that BHP’s exposure to copper – which is a beneficiary of green initiatives and renewable energy – will help earnings in the medium-term.

Using Morgans’ numbers, the BHP share price is trading at around 12x FY21’s estimated earnings.

Outlook

Mr Henry spoke of the company’s outlook:

Our outlook for global economic growth and commodity demand remains positive, with policymakers in key economies signalling a durable commitment to growth and signalling ambitions to tackle climate change. These factors, combined with population growth and rising living standards, are expected to drive continuing growth in demand for energy, metals and fertilisers.

Our leadership team is in place and accelerating our agenda to be a safer, lower cost and more productive. We are well positioned, with a portfolio essential products that will support a cleaner and more prosperous world while generating sustainable returns for our shareholders and value for our communities.

BHP also said that the rollout of vaccines in key economies removes a material amount of downside risk to the short-term demand and price outlook for its portfolio of commodities.

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Motley Fool contributor Tristan Harrison 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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