On Wednesday the S&P/ASX 200 Index (ASX: XJO) had a volatile day with plenty of ups and downs. The benchmark index ultimately ended the day 1.7 points higher at 6,590.2 points.

Will the market be able to build on this on Thursday? Here are five things to watch:

ASX 200 expected to rise.

The Australian share market looks set to rise on Thursday despite a weak night of trade on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 15 points or 0.25% higher this morning. In late trade in the United States, the Dow Jones is down 0.15%, the S&P 500 is down 0.1%, and the Nasdaq has fallen 0.35%.

UK approves Pfizer COVID vaccine.

Overnight the UK became the first country to authorise the Pfizer COVID-19 vaccine for emergency use. According to CNBC, the vaccine will now be rolled out in the country as early as next week. The UK is planning to start with elderly people in care homes and medical workers. Emergency use approval in the United States is under review by the Food and Drug Administration. A decision on that is expected next week.

Gold price rises again.

Gold miners including Evolution Mining Ltd (ASX: EVN) and Newcrest Mining Ltd (ASX: NCM) could push higher today after another rise in the gold price. According to CNBC, the spot gold price is up 0.7% to US$1,831.60 an ounce. This was driven by hopes that a US COVID stimulus package will soon be approved.

Oil prices stormed higher.

Energy producers Oil Search Ltd (ASX: OSH) and Santos Ltd (ASX: STO) could have a solid day after oil prices rebounded. According to Bloomberg, the WTI crude oil price is up 1.7% to US$45.32 a barrel and the Brent crude oil price has climbed 1.9% to US$48.30 a barrel. Optimism that OPEC will make a deal on production cuts has lifted oil prices.

Worley rated as a buy.

According to a note out of Goldman Sachs, the Worley Ltd (ASX: WOR) share price could be going a lot higher from here. This morning the broker reiterated its conviction buy rating and $15.70 price target on the company’s shares. It believes the company is well positioned to capitalise on the energy transition. Goldman’s price target implies potential upside of almost 26% over the next 12 months excluding dividends.

More reading

• ASX 200 flat on Wednesday
• Why this fund manager believes Qantas (ASX:QAN) could emerge “larger and more valuable”
• Why the Oz Minerals (ASX:OZL) share price, up 61% this year, could run higher
• Santos (ASX:STO) share price rated top buy in sector by Citigroup
• Which ASX 200 sectors performed the best in November? 

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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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In this article are two defensive ASX dividend shares that pay reliable income.

The Reserve Bank of Australia (RBA) decided this week to maintain the official interest at just 0.10%.

Here are two ASX dividend shares that pay reliable income to shareholders:

Rural Funds Group (ASX: RFF)

Rural Funds is an agricultural real estate investment trust (REIT).

It owns a diversified portfolio of farming assets. The ASX dividend share has cattle farms, vineyards, almond farms, macadamia farms and cropping properties (sugar and cotton). It currently has 61 properties.

The properties are spread across different states and climactic conditions to add additional diversification to its real estate portfolio.

Most of Rural Funds’ tenants are large and listed entities. Some of its tenants include Treasury Wine Estates Ltd (ASX: TWE), Select Harvests Limited (ASX: SHV), Olam, JBS and Australian Agricultural Company Ltd (ASX: AAC).

Most of these tenants are on long-term leases, particularly the almond farms. Rural Farms has a weighted average lease expiry (WALE) of around 11 years at 30 June 2020. It had a gearing ratio of 29.7% at the end of FY20. 

The ASX dividend share aims to increase its distribution by at least 4% per annum. It has achieved this each year over the past several years since it listed.

Rural Funds has rental increases built into its rental agreements. One large group of rental agreements has a fixed 2.5% increase each year. Its other group of rental agreements have increases linked to CPI inflation. Some of those contracts have market reviews with them.

Rural Funds has been investing in productivity improvements at its farms, particularly the cattle properties, to boost the rental income and value of the farm.

For FY21 the ASX dividend share has provided distribution guidance of 11.28 cents per unit, this equates to a forward distribution yield of 4.4%. The FY21 adjusted funds from operations (AFFO) per unit, which essentially measures the cash net rental profit, is expected to come in at 11.7 cents.

Magellan Infrastructure Fund (ASX: MICH)

This is an exchange-traded fund (ETF) which gives investors exposure to infrastructure businesses around the world.

To be considered to make it into the portfolio, the underlying business must provide a service that is essential to the efficient functioning of a community, while generating cash flows that are not subject to external risks such as commodity prices.

On top of that, the ASX dividend share looks at other risks like gearing levels, sovereign risk, regulatory risk and reporting transparency. The businesses that remain should have reliable demand and generate predictable cash flows according to the infrastructure investor.

At the end of October 2020 its biggest holdings were (in alphabetical order): American Water Works, Atmos Energy Corporation, Crown Castle International Enbridge, Eversource Energy, Red Electrica Corporacion, Sempra Energy, Transurban Group (ASX: TCL), Vopak and Xcel Energy.

The COVID-19 decline has caused the net return over the past four years to drop to 5.5% per annum, though that it is still 4.2% higher than the benchmark, being the S&P Global Infrastructure Net Total Return Index. Whilst those figures include the fees, it must be stated that the annual management fee is 1.05% per annum.

Around 42% of this fund is invested in USA assets, with another 22% in Europe and 17% in the Asia Pacific region. The rest of the assets, apart from a 10% cash position, is invested in the UK, Latin America and Canada.

Based on the current Magellan Infrastructure Fund share price, it offers a trailing distribution yield of 4.1%.

More reading

• What big brokers think of the Treasury Wine (ASX:TWE) share price now
• Leading brokers name 3 ASX shares to sell today
• Why healthcare, tech and consumer staples shares underperformed the ASX 200 in November
• ASX 200 drops on Monday
• Leading brokers name 3 ASX shares to buy today

Motley Fool contributor Tristan Harrison owns shares of RURALFUNDS STAPLED. The Motley Fool Australia owns shares of and has recommended RURALFUNDS STAPLED and Treasury Wine Estates Limited. The Motley Fool Australia owns shares of Transurban Group. The Motley Fool Australia has recommended Magellan Infrastructure Fund. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Sensen Networks Ltd (ASX: SNS) has seen yesterday’s share price gains sliced by more than 10% today after the company held its annual general meeting (AGM).

The Sensen share price rocketed up 27% yesterday on news that the artificial intelligence (AI) analytics company had acquired Snap Network Surveillance. Snap is an AI-powered multi-camera tracking software company based in Adelaide.

However, the Sensen share price is currently trading at 12.5 cents, paring back some of yesterday’s gains.

Highlights from today’s AGM

Sensen reported that internal initiatives made as a result of COVID-19 have led to a record year of financial metrics for the company.

The company says that as of November, contracted total revenue has grown to around $6 million for FY21, up from previous guidance of $5.6 million. Annual recurring revenue (ARR) makes up $3.3 million or 55% of its total revenue estimate.

Sensen says that it has 21 customers on its books generating this ARR, which has grown from 16 in FY20, and 8 in FY19. The average client contributes $160,000 per year to its ARR figures.

With two more quarters to go, the company is optimistic that it is well placed for a record year in both total revenue and ARR.

Growth despite COVID-19

Sensen’s global workforce has grown to 100 software engineers in FY21, despite market difficulties caused by the pandemic. 

The company attributed the growth mainly to sales of its “Gemineye” smartphone-based smart city monitoring software, a disruptive price-based SaaS solution.

Growth for the year was also underpinned by high profile customer wins such as the City of Las Vegas, and orders from casino operators, despite slowdowns in that sector.

Acquisition of Snap

Just yesterday, Sensen announced its acquisition of Snap Network Surveillance.

Sensen notes that Snap, an AI-powered surveillance camera manufacturer, has been making inroads into the casino market, especially in the United States. This is an area Sensen is targeting for growth. The company told investors that it planned to integrate Snap’s technology into its SenDISA platform. 

The takeover will involve Sensen acquiring all intellectual property including patents, trademarks and know-how from Snap, for a price of $1 million. 

That news appears to have been the driving force behind yesterday’s 27% rise in the Sensen share price.

How has the Sensen share price performed in 2020

The Sensen share price has risen by around 20% in 2020, including today’s movements. The company currently commands a market value of $63 million.

Sensen is an AI (artificial intelligence) company focusing on video-IoT (Internet of Things) analytics, and AI-driven software solutions.

More specifically, the company calls itself a “world-leading, data-fusion enterprise” that applies “ingenuity to develop AI-powered products and solutions that address the needs of our increasingly urbanising society”.

More reading

• ASX stock of the day: Sensen Networks (ASX:SNS) rockets 27%

Motley Fool contributor Eddy Sunarto has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Mesoblast limited (ASX: MSB) share price was one of the best performers on the ASX 200 in November.

The biotechnology company’s shares raced a massive 33% higher over the month.

Why did the Mesoblast share price zoom higher in November?

The catalyst for the strong gain by the Mesoblast share price in November was the announcement of a major deal with pharma giant Novartis.

That deal has seen Novartis sign an exclusive worldwide license and collaboration agreement for the development, manufacture, and commercialisation of Mesoblast’s mesenchymal stromal cell (MSC) product remestemcel-L for the treatment of COVID-19 Acute Respiratory Distress Syndrome (ARDS).

According to the release, Novartis will pay US$50 million upfront and then upwards of US$1.25 billion in milestone payments.

This news went down very well with analysts at Bell Potter. They described it as a “fantastic deal” for Mesoblast. Furthermore, they like that it provides greater certainty in relation to the manufacturing and commercialisation of the product for COVID-19 ARDS.

Can the Mesoblast share price go higher?

This month, Bell Potter has looked closer at the deal and adjusted its price target accordingly.

The broker has a (speculative) buy rating and $7.40 price target on the company’s shares. This is up from $7.00 previously and compares to its last close price of $4.43.

According to the note, Bell Potter has lifted its FY 2021 earnings forecasts to reflect the deal.

It commented: “Over the next 12 months we expect MSB to receive US$32.5m in milestones from partner Grunenthal for back pain product and US$105m from partner NVS for successful results from Phase 3 trial and approval for COVID-19 ARDS for remestemcel-L. In addition, US$35m is available to MSB on its existing debt facilities, which provides a runway to at least year end FY22.”

What else did it say?

There are also a number of catalysts on the horizon which it feels could take its shares higher.

“Phase 3 COVID-19 ARDS trial has surpassed recruitment of 180 patients required for third and final interim analysis, which we expect to be completed by mid-Dec’20. The trial is now expected to complete recruitment in early 1QCY21, with results later in 1QCY21. Results from both Phase 3 back pain and heart failure trials are expected in Dec’20, which we expect will be key catalysts for the stock, given these indications account for the majority of our valuation for MSB,” it concluded.

More reading

• ASX 200 flat on Wednesday
• Why Laybuy, Mesoblast, Sandfire, & Telix shares are charging higher
• ASX 200 down 0.2%: Zip’s November update, Mesoblast jumps, Westpac’s asset sale
• Mesoblast (ASX:MSB) share price jumps 19% on FDA update
• Flight Centre and Mesoblast were among the most traded shares on the ASX last week

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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The S&P/ASX 200 Index (ASX: XJO) was almost flat today, rising slightly to 6,590 points.

Here are some of the highlights from the ASX:

Westpac Banking Corp (ASX: WBC)

Westpac revealed today that it is going to sell Westpac General Insurance Limited and Westpac General Insurance Services Limited to Allianz and enter into an exclusive 20-year agreement for the distribution of general insurance products to Westpac’s customers.

The sale price of $725 million represents a multiple of 1.3x FY20 gross written premium and is estimated to result in a small post-tax gain on sale in FY21. The sale of the general insurance business adds around 12 basis points to Westpac’s common equity tier 1 (CET1) capital ratio.

The transaction also includes contingent payments subject to integration milestones and business performance over the next five years, as well as ongoing payments in accordance with the distribution agreement.

The new distribution arrangement expands the ASX 200 bank’s existing partnership with Allianz, which has seen Westpac distribute a range of Allianz’s products to customers including auto, travel, boat and business insurance since 2015.

Westpac group CEO, Peter King, said: “This transaction is another step in simplifying our business while continuing to help customers with their general insurance needs.

“General insurance products are important for many Australians and we are pleased to be entering a long-term partnership with a global insurance expert to continue to help customers protect the things they value.”

Westpac will retain responsibility for certain pre-completion matters and provide protection to Allianz via a combination of provisions, warranties and indemnities.

Completion of the transaction is subject to various regulatory approvals and is expected to occur in the second half of 2021.

The Westpac share price finished up by 0.2% in reaction to this news.

Mesoblast Limited (ASX: MSB)

The Mesoblast share price went up around 7% today after making an announcement saying that the US Food and Drug Administration (FDA) has granted ‘fast track’ designation for remestemcel-L in the treatment of acute respiratory distress syndrome (ARDS) due to COVID-19 infection.

The ASX 200 share said that fast track designation by the FDA is intended to facilitate development and expediate the review of therapies to treat serious and life-threatening conditions with no or limited treatment options so that an approved product can reach the market quickly. Under the fast track designation, a biological license application (BLA) for remestemcel-L is eligible for both rolling submission and priority review.

Downer EDI Limited (ASX: DOW)

Only a couple of weeks ago Downer announced it was selling its blasting services business for $62 million. Today, the company announced that it was going to divest 70% of its laundries business for $155 million.

The proposed buyer of the majority shareholding is Australian private equity outfit, Adamantem Capital.

Grant Fenn, the CEO of Downer, said that this deal represented a significant step in Downer’s urban services strategy:

“The sale of 70% of laundries achieves the objective of removing one of the most capital-intensive businesses from the Downer balance sheet. Laundries continues to perform well as it recovers from the COVID-19 lockdowns in New Zealand and Victoria and by retaining a 30% interest we will participate in this ongoing recovery.

“We look forward to working closely with Adamantem and its management team providing market-leading services for our customers and employment opportunities for our people.”

More reading

• Why this fund manager believes Qantas (ASX:QAN) could emerge “larger and more valuable”
• Why the Oz Minerals (ASX:OZL) share price, up 61% this year, could run higher
• Which ASX 200 sectors performed the best in November? 
• Why Laybuy, Mesoblast, Sandfire, & Telix shares are charging higher
• ASX 200 down 0.2%: Zip’s November update, Mesoblast jumps, Westpac’s asset sale

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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Qantas Airways Limited (ASX: QAN) share price has shrugged off its morning losses to be up 1.65% in late afternoon trading.

At $5.56 per share, it’s still 22.8% down since 2 January, having yet to recover from the drubbing delivered by the global pandemic. As domestic and international air travel ground to a halt, Qantas share price plummeted 70% by 19 March.

Still, the 158% rally from the 19 March low is massive. For comparison, the broader S&P/ASX 200 Index (ASX: XJO) is up 45% from its own 23 March low.

But despite that strong rally, and numerous headwinds still facing the airline in the mid-term, Montgomery Investment Management director Tim Kelley says there are good reasons why the Qantas share price could run higher.

We’ll get to that in a tick. But first…

What does Qantas do?

Qantas is Australia’s largest airline for regional, domestic and international travel. Qantas launched the low-cost carrier Jetstar in Australia in 2004 in answer to Virgin Australia’s low-cost offerings. Jetstar-branded airlines now operate across Asia Pacific, so long as borders are open.

The company’s subsidiary businesses include Qantas Freight Enterprises, Qantas Frequent Flyer and Qantas Loyalty. Qantas shares began trading on the ASX in 1999.

The case for further upside in Qantas’ share price

Writing in Livewire, Tim Kelley explains why there could be further upside for the Qantas share price:

As we noted in May, QAN entered the pandemic in a strong position, with a capable management team, a good liquidity position, and a business that relies more on domestic (which is likely to resume sooner) than international travel for profitability. It also benefits from a strong loyalty business which has continued to generate revenue through the pandemic.

Citing Virgin –which went into administration on 21 April owing almost $7 billion to creditors – Tim points out that Qantas’ relative strength could allow it to come out of the pandemic shutdowns strongly even as other airlines lose out on market share.

While lasting impacts from the company’s proactive initiatives during the pandemic shutdowns remain to be seen, Tim concludes:

“It is reasonable to think that Qantas’s relative strength going into COVID-19 will prove to be a very valuable asset, and that post-COVID it may be a larger and more valuable business than it had been.”

As domestic borders reopen and the world moves closer to a vaccine that could see the return of international travel, the fund manager believes the Qantas share price will be one to watch.

More reading

• Why the Oz Minerals (ASX:OZL) share price, up 61% this year, could run higher
• Which ASX 200 sectors performed the best in November? 
• REX Airlines (ASX:REX) share price flies as promotional fares go on sale
• ASX 200 down 0.2%: Zip’s November update, Mesoblast jumps, Westpac’s asset sale
• Meet the most unpopular ASX large cap stock according to analysts

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Although the pandemic has stifled the growth of a number of companies in FY 2021 such as A2 Milk Company Ltd (ASX: A2M) and Ramsay Health Care Limited (ASX: RHC), not all companies are struggling.

Two companies which have continued to deliver very strong growth in FY 2021 are listed below. Here’s what you need to know:

Afterpay Ltd (ASX: APT)

This payments company has been an outstanding performer during the pandemic. Thanks to the accelerating shift to online shopping and the growing popularity of the buy now pay later payment method, Afterpay is on course for another stellar result in FY 2021.

During the first quarter of the financial year, Afterpay reported a 115% increase in underlying sales to a record of $4.1 billion. This was driven by a 229% increase in US underlying sales to $1.6 billion, a 346% jump in UK underlying sales to $0.3 billion, and a 63% lift in Australian underlying sales to $2.2 billion. Repeat usage, another large increase in merchant numbers, and a whopping 98% increase in active customers to 11.2 million helped drive the strong quarterly result.

Pleasingly, its strong form has continued since the end of the quarter. At its recent annual general meeting, co-CEO Anthony Eisen revealed that trading in October and November was strong.

Mr Eisen commented: “October was another record month for underlying sales globally and we are performing ahead of this in November. The growth of new customers is accelerating since the end of Q1 in both the US and UK as the pipeline of new merchants go live on our platform.”

Xero Limited (ASX: XRO)

Another company which has been on form this year despite the pandemic is Xero. After a bumper result in FY 2020, Xero has followed this up with an even stronger first half to the new financial year.

During the half, the company’s operating revenue grew 21% over the prior corresponding period to NZ$409.8 million. This led to Xero’s annualised monthly recurring revenue (AMRR) growing 15% to NZ$877.6 million.

Pleasingly, things were even better for its earnings thanks to further operating leverage. Xero’s earnings before interest, tax, depreciation and amortisation (EBITDA) increased by an impressive 86% to NZ$64.9 million and its net profit after tax was 26 times greater than the prior corresponding period at NZ$34.5 million.

Since this release, the company has launched a US$600 million convertible notes offering. These funds will be used to support its growth plans. There is speculation that this could mean a sizeable acquisition in the near future.

More reading

• Why the Afterpay (ASX:APT) share price continues to dominate
• 5 things to watch on the ASX 200 on Wednesday
• Why the Xero (ASX:XRO) share price zoomed 20% higher in November
• Why healthcare, tech and consumer staples shares underperformed the ASX 200 in November
• Why the Afterpay (ASX:APT) share price and these ASX stocks could get a boost next week

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Xero. The Motley Fool Australia owns shares of and has recommended A2 Milk. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Ramsay Health Care Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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If you want to construct a balanced portfolio, having a few blue chip ASX shares in there would be a smart move.

Blue chip shares tend to be companies that are well-known, long-established, and have strong financial positions. In other words, they are not going anywhere any time soon. This tends to make them safer than the average share.

Though, it is worth remembering that not all blue chip ASX shares are equal and some are better than others.

With that in mind, listed below are two ASX blue chip shares that come highly rated:

Goodman Group (ASX: GMG)

Goodman Group is an integrated commercial and industrial property group. It has been growing at a solid rate in recent years and has been tipped to continue this positive form in the years to come. This is thanks to future developments and the strength of its portfolio.

Goodman’s portfolio has a focus on high-quality properties in key locations that management believes will deliver sustainable returns for investors. These include logistics and warehouse facilities which have exposure to the growing ecommerce market through relationships with Amazon, DHL, and Walmart.

Analysts at Macquarie were impressed with Goodman’s first quarter performance and believe it is well placed for growth over the coming years. Its analysts have an outperform rating and $19.86 price target on its shares.

Sonic Healthcare Limited (ASX: SHL)

Sonic Healthcare is a leading medical diagnostics company with operations across the world. It has been a very impressive performer in FY 2021. Sonic recently released its first quarter update and revealed a 29% increase in revenue to $2,144 million and a 71% lift in EBITDA to $580 million.

The key driver of this growth was exceptionally strong demand for COVID-19 testing services globally. Though, it is worth noting that the rest of the business performed positively as well. And while this level of growth is expected to moderate in the coming quarters, Sonic has been tipped to deliver a very strong full year result next year.

Morgan Stanley, for example, is pleased with its strong growth so far in FY 2021 and remains positive on the future. In light of this, it recently reaffirmed its overweight rating and $40.40 price target on its shares.

More reading

• Why are ASX property shares on the rise today?
• Why healthcare, tech and consumer staples shares underperformed the ASX 200 in November
• 2 ASX 200 healthcare shares that outperformed in November 
• 3 ASX dividend shares rated as buys
• 2 of the best ASX shares for your retirement portfolio

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Sonic Healthcare Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Salesforce.com Inc (NYSE: CRM) is one of the largest and oldest ‘cloud’ companies in the world. And it looks set to become even larger. Salesforce announced this morning (AEDT time) that it will acquire the workplace communications company Slack Technologies Inc (NYSE: WORK).

About the companies

Salesforce was founded back in 1999, and today provides customer relationship management services as well as marketing automation, analytics, and application development services. This company has been on a tear in 2020 (and before that). Salesforce shares have climbed 44.53% in 2020 so far. It gets better. The company has climbed 193% over the past 5 years, and 576% over the past decade. On the current share price of US$241.35 a share, Salesforce has a gigantic market capitalisation of US$219.6 billion.

Slack is a US$25 billion company which specialises in intra-workplace communication via its eponymous flagship app. Billed as an ’email killer’, Slack allows colleagues to communicate and share data, documents and other items with each other. It has been growing handsomely in recent years, including posting an annual revenue growth number of 49% in a recent quarterly update.

Acquisition news

Salesforce announced it would be acquiring Slack in a stock/cash arrangement. Each shareholder of Slack will receive US$26.79 in cash per share under the deal, as well as 0.076 shares of Salesforce for every share of Slack owned. That offer values Slack at a market cap of roughly US$27.7 billion

Slack shares had been trading between US$25-$29 for most of November. However, the stock jumped almost 40% last week to roughly US$40 a share when rumours of this deal began circulating. Last night (our time), Slack shares closed at US$43.84, representing a market cap of US$25.01 billion.

Salesforce + Slack: A blessed union

Salesforce had this to say on the merger:

[The] combination of [the] #1 CRM platform with the most innovative enterprise communications platform will create the operating system for the new way to work, enabling companies to grow and succeed in the all-digital world… This is a match made in heaven. Together, Salesforce and Slack will shape the future of enterprise software and transform the way everyone works in the all-digital, work-from-anywhere world. I’m thrilled to welcome Slack to the Salesforce Ohana once the transaction closes.

Slack’s management was equally exuberant, with CEO Stewart Butterfield stating the following:

Salesforce started the cloud revolution, and two decades later, we are still tapping into all the possibilities it offers to transform the way we work. The opportunity we see together is massive… Personally, I believe this is the most strategic combination in the history of software, and I can’t wait to get going.

It seems this announcement is a done deal. However, it’s worth noting that, although the boards of directors of both companies have approved the deal, Slack shareholders have yet to sign off on it. Although, Slack’s management has recommended they do so. If they indeed give the green light, the merger is only expected to be completed “in the second quarter of Salesforce’s fiscal year 2022″.

More reading

• 2 fantastic blue chip ASX shares to buy today
• Why the Chalice Gold Mines (ASX:CHN) share price is down 5% today
• 3 ASX REITs with notable ESG scores
• Why the Oz Minerals (ASX:OZL) share price, up 61% this year, could run higher
• Santos (ASX:STO) share price rated top buy in sector by Citigroup

Sebastian Bowen owns shares of Slack Technologies. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Salesforce.com and Slack Technologies. The Motley Fool Australia has recommended Slack Technologies. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Chalice Gold Mines Limited (ASX: CHN) share price has returned from its trading halt and is dropping lower.

In afternoon trade the mineral exploration company’s shares are down 5% to $3.86.

Why was the Chalice Gold Mines share price in a trading halt?

Chalice Gold Mines requested a trading halt on Monday whilst it launched an institutional placement.

This morning the company revealed that it has received firm commitments to raise $100 million through a placement at $3.75 per share. This represents a discount of 7.6% to its last close price.

Management advised that the placement was strongly supported by a range of domestic and international institutions.

It will now push ahead with a share purchase plan (SPP) which aims to raise up to $10 million at the same price.

What is the money being used for?

According to the release, the proceeds from the placement and SPP will be used to accelerate its exploration activities at its Julimar Ni-Cu-PGE Project in Western Australia.

This includes ~160,000 metres of resource definition drilling in order to define a maiden mineral resource estimate for the Gonneville discovery by mid-2021.

It also intends to complete scoping and pre-feasibility studies for the Gonneville discovery by the fourth quarter of 2021 and and fourth quarter of 2022, respectively.

Funds will also be used for initial drilling at new EM anomalies within the Julimar State Forest and initial regional exploration activities within the new West Yilgarn province.

Chalice’s Managing Director, Alex Dorsch said: “The demand for the placement was incredibly strong, with the book covered multiple times over the desired amount. This is testament to the scale and quality of the discovery at Julimar, but also the potential of the region to become a new world class base and precious metals mineral province.”

“Approximately 160,000 metres of diamond and RC drilling is now planned at Gonneville to support the delivery of a maiden Mineral Resource in mid-2021, which will then lead into mining studies planned over the following 18 months. We have also earmarked significant funding for initial drill testing of the compelling multi-kilometre scale targets within the Julimar State Forest once approvals are obtained,” he concluded.

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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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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