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Respected fund manager Wilson Asset Management (WAM) has recently identified two ASX shares that it owns in its portfolio.

WAM operates several listed investment companies (LICs). Some focus on larger companies like WAM Leaders Ltd (ASX: WLE) and WAM Research Limited (ASX: WAX).

There’s also one called WAM Capital Limited (ASX: WAM) which targets “the most compelling undervalued growth opportunities in the Australian market.”

The WAM Capital portfolio has delivered an investment return of 16.4% per annum since inception in August 1999, before fees, expenses and taxes. This gross return outperformed the S&P/ASX All Ordinaries Accumulation Index return of 8.3% per annum over the same timeframe.

These are the two ASX shares that WAM Capital outlined in its most recent monthly update:

Codan Limited (ASX: CDA)

Codan is a manufacturer and supplier of communications, metal detection and mining technology for use in difficult environments by humanitarian organisations, security and military groups, mining companies and governments.

WAM said that in February, the company announced it was going to wholly acquire the US-based business called Domo Tactical Communications for $114 million, a wireless communications technology provider that supplies more than 20 US government agencies, as well as the ‘Five Eyes’ intelligence communities. Five Eyes is an alliance of intelligence groups from the US, the UK, New Zealand, Australia and Canada.

Codan says that the acquisition will be earnings accretive. In the first year under the ASX share’s ownership it is expected to make $90 million of revenue, $14 million of earnings before interest, tax, depreciation and amortisation (EBITDA) and $9 million in profit before tax.

Codan’s share price rose in February after news of the acquisition as well as the FY21 half-year report, where Codan revealed a record profit result. Sales grew by 14% to $194 million. Codan also grew its dividend by 40% to 10.5 cents per share.

Virgin Money UK CDI (ASX: VUK)

Virgin Money is one of the larger banks in the UK. It has 6.4 million customers through typical retail and business banking services.

The fund manager said that Virgin Money reported a solid start to the year during reporting season, with a continued roll-out of its rebranding programme, a return to making a profit in statutory terms and high levels of customer deposits (up 0.9% in the quarter ending 31 December 2020).

The number of deferred loans in the ASX share’s portfolio have been declining – those borrowers were given loan support due to the pandemic.

WAM Capital is positive about Virgin Money UK’s outlook because the investment team believe the UK’s accelerative vaccination program and accommodative fiscal and monetary policies will support the company’s rebound from the COVID-19 pandemic.

More reading

• The simple yet incredibly effective way to generate term-deposit busting income from just one quoted ASX fund
• These were the best performing ASX 200 shares in February
• Amaysim (ASX:AYS) share price higher as company moves to delist
• Why is the WAM Capital (ASX:WAM) share price on the rise?
• Here’s why the Codan (ASX:CDA) share price just hit a record high

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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Nasdaq Inc (NASDAQ: NDAQ) is waiting to hear from the Securities and Exchange Commission (SEC) regarding its board diversity proposal.

A request was submitted in December 2020 regarding the board diversity policy that Nasdaq can set for the businesses trading on its exchange.

The Wall Street Journal reports that Nasdaq will have to wait until August (at the latest) for the SEC’s ruling regarding its request.

Why does Nasdaq want more board diversity?

According to the WSJ, Nasdaq wants more women, racial minorities and LGBT individuals on its boards. If a company’s board cannot meet the requirements, Nasdaq wants public disclosure of why it cannot.

The exchange has set board targets that include at least one woman and a director that identifies as a racial minority or lesbian, gay, transgender, bisexual or queer.

Following a recent audit of its boards, Nasdaq discovered that more than three-quarters of its listed companies do not meet its envisioned diversity metrics. This resulted in pursuing the SEC to update the exchange’s rules.

Why is the SEC dragging its feet?

Last month, 12 Republican members of the US Senate Banking Committee wrote a letter to the SEC expressing concerns over the Nasdaq proposal.

The SEC claims that it has delayed the process due to the complexity of the request. By deciding to “institute proceedings”, the SEC automatically receives a 90-day extension for the outcome. This can be further extended by another 60 days, which is what takes us to August 2021.

If the SEC accepts the proposal, all Nasdaq listed companies will have to disclose board diversity statistics within twelve months.

Foolish Takeaway

Variety is the spice of life. Many businesses are already considering how diverse the group is and why it’s important to have an assortment of professionals steering the ship. This comes as part of the general corporate and social responsibly (CSR) movement.

Nasdaq has taken a significant position with its SEC request. We’ll be waiting to hear about the outcome and what it will mean for the market.

More reading

• Macquarie Group (ASX:MQG) is hungry for assets as its share price grows
• Qantas (ASX:QAN) successfully trials COVID vaccine app in preparation of return to international travel
• 2 quality ETFs to buy in March
• Tabcorp (ASX:TAH) share price falls as demerger speculation continues
• ASX 200 climbs, Westpac in the clear, Nine reveals a WIN-ning deal

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The Macquarie Group Ltd (ASX: MQG) share price has been performing strongly over the last 6 months, gaining 24.5% over the period. Similar to the big four banks, Macquarie appears to be enjoying the rotation from tech into financials. But there’s a lot more going on for Australia’s fifth-largest bank.

The Macquarie share price finished the day 0.95% higher, at $149.60 a share.

Macquarie has been busy buying (and trying to buy) more assets. Given the bank’s recent performance, it’s worth looking at what the bank has been cooking up.

Whatcha gonna do with all that cash?

Being predominantly an investment bank, Macquarie focuses heavily on getting the highest return on its assets. Through both Macquarie infrastructure and real assets (MIRA) and Macquarie investment management (MIM), the investment bank acquires and operates a diversified pool of assets.

From Macquarie’s operational briefing in February, MIRA had a total of $25.7 billion of equity ready to deploy. This was after the division had raised $6.6 billion of new equity. With all that capital sitting and waiting for returns, Macquarie is busily searching for opportunities.

Earlier this week Vocus Group Ltd (ASX: VOC) accepted MIRA’s $3.5 billion takeover bid for the network solution provider’s assets. The Vocus Board has agreed to unanimously recommend that Vocus shareholders vote in favour of the takeover. Both the Macquarie and Vocus share prices lifted on the deal. 

On top of that, MIRA is still working on a takeover of Vitalhavest Freehold Trust (ASX: VTH). The investment subsidiary increased its offer today, but no word yet on how it has been received. MIRA is duking it out with Roc Private Equity, another investment firm that finds the berry farm portfolio appealing.

In the event MIRA manages to acquire Vitalharvest, the subsidiary will still have over $18 billion in equity to deploy.

Lifted guidance lifts Macquarie’s share price

The Macquarie (MQG) share price got a recent bump after upgrading its full-year guidance in late February. Positively, the bank now forecasts profits to grow, rather than its original expectation of a slight decline.

The release stated Macquarie expects its profits to increase by roughly 5% to 10% for FY2021.

Furthermore, Macquarie advised that it is still maintaining a conservative approach in the current environment. Whether that means Vitalharvest is the last potential acquisition on the radar for FY2021 is uncertain.

More reading

• Vitalharvest (ASX:VTH) share price flat despite takeover stoush
• ASX 200 unmoved, Flight Centre soars, Afterpay keeps falling
• AMP (ASX:AMP) selling assets too cheaply warns Macquarie
• Why the Macquarie (ASX:MQG) share price just hit a record high
• Why the Rio Tinto (ASX:RIO) share price is among the worst performers today

Motley Fool contributor Mitchell Lawler owns shares of Macquarie Group Limited. The Motley Fool Australia owns shares of and has recommended Macquarie 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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Qantas Airways Limited (ASX: QAN) announced today it has successfully trialled an app with customers designed to track vaccinations and COVID test results. Qantas tested the app, called CommonPass, on passengers on its Frankfurt to Darwin repatriation flight.

Qantas’ CommonPass app

In a media statement, Qantas declared the CommonPass App’s trial was the first time it had used it for passengers. Last month, the airline trialled the smartphone app with some of its crew.

The app allows the airline to verify negative COVID test results before anyone can board a plane. It works by connecting customers to certified testing labs, which will then upload the results straight to the app. Customers will then be able to show staff proof of a negative test. This is a requirement for travel into many countries – including Australia.

Qantas is hoping to integrate vaccination information into the app in future. The airline says it will work with the federal government to look at ways to show COVID vaccine certificates on the software.

Group Chief Customer Officer, Stephanie Tully, said a digital health pass would assist airlines and governments globally post-coronavirus.

“We want to get our international flights back in the air and our people back to work and a digital health pass will be a key part of that,” said Ms Tully.

“COVID test results and proof of vaccine will be required in many countries for quarantine-free travel, just as it has been for polio and yellow fever vaccinations in the past.  Even if it wasn’t a government requirement, Qantas has always been a leader in safety, and we have a responsibility to our customers and crew.”

The app’s developer’s (The Commons Project Foundation) CEO, Paul Meyer, assured customers the process would be “secure, private, and a trusted experience…”

The national carrier is hoping to integrate CommonPass functions into its already existing Qantas app.

Other news affecting Qantas

The federal government revealed its $1.2 billion domestic tourism package to replace JobKeeper yesterday. The program, which will see airline tickets subsidised by 50% for travel to 13 domestic tourist locations, saw the Qantas share price lift, along with Flight Centre Travel Group Ltd (ASX: FLT), Webjet Limited (ASX: WEB), and Helloworld Travel Ltd (ASX: HLO). All of these shares have retreated today as initial enthusiasm for the program has waned.

Qantas CEO, Alan Joyce, defended the program amid accusations from Regional Express Holdings Ltd (ASX: REX) deputy chair, John Sharp, that it would primarily benefit the larger airline.

“You can’t feel sorry for Rex because Rex has gotten all this money from the government previously,” Mr Joyce said on the Today show.

“They got as a percentage of revenue seven times the aid that Qantas got last year, which is the equivalent of Qantas getting $7bn.”

Qantas share price snapshot

Qantas shares closed the day flat at $5.30. Almost one year ago today, the Qantas share price hit a low of $2.03. Since then, the company’s value has increased by 159.1%. Shares, however, have still not reached their pre-pandemic price of $6.67.

Qantas has a market capitalisation of $10 billion.

More reading

• Brokers name 3 ASX shares to buy right now
• What this broker thinks about ASX travel shares after government’s stimulus package
• ASX 200 up 0.95%: Afterpay rises, Westpac’s APRA update, Qantas upgraded
• Why the Qantas (ASX:QAN) share price could shoot higher in 2021
• 5 things to watch on the ASX 200 on Friday

Motley Fool contributor Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Helloworld Limited. The Motley Fool Australia owns shares of and has recommended Webjet Ltd. The Motley Fool Australia has recommended Flight Centre Travel Group Limited and Helloworld 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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If you’re wanting to add some diversification to your portfolio in March, then you might want to look at exchange traded funds (ETFs).

ETFs help investors achieve this because they provide easy access to a large and diverse number of different shares through a single investment.

With that in mind, listed below are two ETFs which could be worth considering. Here’s what you need to know about them:

BetaShares Global Cybersecurity ETF (ASX: HACK)

The first ETF to look at is the BetaShares Global Cybersecurity ETF. It aims to track the performance of an index that gives investors with exposure to the growing global cybersecurity sector.

Given how cybercrime is on the rise, demand for cybersecurity services is expected to rise strongly over the coming decade and beyond. And as this industry is heavily under-represented on the ASX, this ETF give investors an easy way to invest in the best companies in the space.

Among those companies are industry giants such as Accenture, Cisco, Cloudflare, Crowdstrike, and Okta.

Over the last three years, the fund has generated a return of 20.26% per annum.

iShares Global Consumer Staples ETF (ASX: IXI)

Another ETF to look at is the iShares Global Consumer Staples ETF. This fund has been designed to measure the performance of global consumer staples companies. This includes companies that produce essential products such as food, tobacco, and household items.

Given how demand for these types of products is relatively consistent whatever the economy throws at them, this ETF is likely to be suitable for investors that are looking for low risk options. 

Among its holdings are the likes of Coca-Cola, Nestle, PepsiCo, Procter & Gamble, Unilever, and Walmart.

Over the last 10 years, the iShares Global Consumer Staples ETF has generated an average total return of 9% per annum.

More reading

• Could the Tesla (NASDAQ:TSLA) camera hack lift ASX cybersecurity shares?
• Chinese and Russian hack attacks put ASX cybersecurity shares in spotlight
• 2 high quality ETFs for ASX investors to buy in March
• 2 compelling ASX shares to buy in March 2021
• 2 high quality ETFs for ASX investors to buy in February

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of BETA CYBER ETF UNITS and iShares Global Consumer Staples ETF. 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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Tabcorp Holdings Limited (ASX: TAH) shares edged lower today as rumours continue circulating about a potential demerger. By the market’s close, the Tabcorp share price finished the day trading 0.22% lower at $4.60. In contrast, the S&P/ASX 200 Index finished Friday’s session 0.79% higher.

Tabcorp might take a punt on a successful demerger

The Australian reported yesterday that Tabcorp will be moving forward with a strategic review to assess a demerger of its wagering and media unit from its lotteries arm. Speculation of the move has been rife for at least a month. The newspaper claims as many as three bidders are keen to make a deal.

Tabcorp was expected to make an announcement regarding the demerger during its half-yearly update but gave very little away, citing that “details of any proposal remained confidential, and were indicative and non-binding in nature.”.

Many believe the three bidders are Entain – owners of Ladbrokes, Apollo Global Management, and Blackstone. Rumours are Apollo’s offer is somewhere between $3 billion to $3.5 billion. Entain has apparently offered $3 billion and left open the possibility for scrips.

According to The Australian’s report, Entain CFO Rob Wood is confident of making a deal. He believes the biggest hurdle to acquisition would be from the board and not regulators, like the Australian Competition and Consumer Commission (ACCC).

Tabcorp’s financial performance

For the six months ending 31 December 2020, Tabcorp reported a net profit after tax of $185 million. The result was 7% lower than the prior corresponding period (pcp).

Revenue declined by 1.5% on the pcp, while earnings before interest, tax, depreciation and amortisation (EBITDA) was down 6.2%.

The company attributed the poor performance to the COVID-19 pandemic. The group’s CEO said at the time that while the results may have been disappointing, the company was “well-positioned for the second half…”.

A closer examination of the results reveals why some Tabcorp shareholders are keen to sell off the wagering division of the betting behemoth. For the half year, Tabcorp Lotteries and Keno saw revenue increase 1.6% on the pcp. Its wagering division, however, saw revenues collapse by 51% on the pcp – totalling $73 million.

Tabcorp share price snapshot

Nearly one year ago, the Tabcorp share price reached a 52-week low of $2.07. Today’s price represents a 122% gain since that time. Tabcorp shares are now almost at parity with their pre-coronavirus showing of $4.61.

Tabcorp has a market capitalisation of $10.2 billion.

More reading

• The Tabcorp (ASX:TAH) share price wobbles on results

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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The S&P/ASX 200 Index (ASX: XJO) ended the day up 0.8% to 6,767 points.

Here are some of the highlights from the ASX today:

Nine Entertainment Co Holdings Ltd (ASX: NEC)

The Nine share price fell 1% after announcing that the ASX 200 media business has signed a deal with WIN Corporation for a new regional television affiliation agreement.

This minimum 7-year agreement will result in WIN broadcasting Nine’s metropolitan free to air television content from various 9 channels into markets including Tasmania, regional Western Australia, Victoria, Queensland and Southern New South Wales. Nine said this will provide seamless access to Nine’s television content across all of metropolitan and regional Australia.

Under the new agreement, which commences on 1 July 2021, WIN will pay an affiliation fee of around 50% of its regional advertising revenue to Nine and provide airtime to Nine to allow promotion of Nine’s assets across WIN’s television and radio network. As part of the arrangements between Nine and WIN, WIN will also provide a sales representation service for Nine in Northern NSW and Darwin for a period of time.

Nine CEO High Marks said:

While our relationship with Southern Cross Media Group Ltd (ASX: SXL) has been strong over the last five years, the opportunities presented by the WIN Network to both extend the reach of Nine’s premium content into more regional markets under one agreement, and to work co-operatively with them on a national and local news operation, means that this is the right time for us to return to WIN. The terms of this new affiliation agreement should be positive to Nine’s earnings before interest, tax, depreciation and amortisation (EBITDA) from FY22 through the broader reach of Nine’s channels and by enabling incremental efficiencies across both sales and news.

Westpac Banking Corp (ASX: WBC)

Today, big four ASX 200 bank Westpac noted that the Australian Prudential Regulation Authority (APRA) has today announced that it has closed its investigation into matters related to the AUSTRAC proceedings. This follows the conclusion of the Australian Securities and Investments Commission’s (ASIC) AUSTRAC-related investigation in December 2020.

The $1 billion operational risk capital add-on, which reflects the bank’s heightened operational risk profile, will remain in place until Westpac completes its remediation under the court enforceable undertaking (CEU).

APRA deputy chair John Lonsdale said:

Although the investigation has not found evidence of breaches of the banking act or the Banking Executive Accountability Regime (BEAR), APRA remains determined to ensure Westpac rectifies its risk governance weaknesses effectively and sustainably.

Under the enforceable undertaking, Westpac has clearly defined executive and board accountabilities for the implementation of its integrated risk governance remediation plan. APRA will be holding Westpac to account for the delivery of the required improvements.

The Westpac share price ended the day lower by 0.3%. 

Speedcast International Limited (ASX: SDA)

Speedcast announced today that it has completed the restructuring and it’s going to emerge under new ownership, which sets into motion the winding up of Speedcast International Limited.

The new parent company will be called Speedcast Holdings III. The Speedcast business will continue to serve customers under Centerbridge Partners’ new ownership.

Speedcast International Limited has no remaining material assets or liabilities having transferred its assets in exchange for the cancellation of its secured debt. Speedcast said that was done at a significant shortfall to the secured lenders. It will shortly initiate a voluntary liquidation process.

More reading

• Here’s why the Challenger (ASX:CGF) share price is up 80% in 6 months
• Goldman reaffirms its conviction buy on this ASX share on Yallourn shutdown
• Morgans just added this ASX 200 share to its model portfolio
• Why Flight Centre, Northern Star, Southern Cross Media, & Treasury Wine are sinking
• Why ASX income investors should consider this dividend ETF

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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ASX gold mining shares have been hit by a double whammy recently of weaker gold prices and a rising Australian dollar. As a result, ASX gold shares across the board, such as Evolution Mining Ltd (ASX: EVN), have fallen by at least ~30% since setting record all-time highs in mid-2020. 

While the gold price might not be going anywhere anytime soon, brokers have called out the following two ASX gold shares for their potential to deliver further growth through exploration and operational upside. 

1. Gold Road Resources Ltd (ASX: GOR) 

The Gold Road share price pushed as much as ~10% higher on Wednesday after the company announced its 2020 full-year results. Gold Road delivered a significant uplift in earnings with earnings before interest, taxes, depreciation and amortisation (EBITDA) of $170.6 million, compared to the $9.8 million EBITDA loss in 2019. This resulted in a net profit after tax (NPAT) of $80.8 million compared to the $4.7 million loss in 2019. 

Gold Road’s financial performance was ahead of Macquarie Group Ltd (ASX: MQG) estimates. The broker rated Gold Road as an outperform with a $1.50 price target on 11 March. This represents an almost 30% premium to the Gold Road share price as at Friday’s close.

Looking ahead, the broker pointed to the company’s tier-one gold mine, Gruyere, to drive outperformance in the medium term. 

Macquarie acknowledged the recent weakness in the gold price and pressure from the Australian dollar. But it also described Gold Road as a ‘high margin producer’ that should perform well versus ASX gold shares. 

2. Newcrest Mining Ltd (ASX: NCM) 

Newcrest is the largest ASX gold share and one of the lowest-cost gold producers in the world. Despite the company’s size, it is progressing a number of growth options, more notably at its Havieron and Red Chris Projects. 

Morgan Stanley has an overweight rating for Newcrest shares with a $32.10 price target as at 12 March. The Newcrest share price closed today’s session at $24.02.

The broker sees the potential for exploration expansion after a new zone of high-grade mineralisation was discovered at Red Chris. It was also pleased with the advancements made at the Havieron project including board funding approval and early works construction being underway. 

More reading

• 5 things to watch on the ASX 200 on Friday
• 5 things to watch on the ASX 200 on Thursday
• ASX 200 drops, Zip down, Afterpay soars
• Why Afterpay, Gold Road, Hansen, & Silver Lakes shares are charging higher
• Why the Gold Road (ASX:GOR) share price is shooting 8% higher

Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie 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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For many years, the Challenger Ltd (ASX: CGF) share price was one that many an ASX investor probably wished they could forget. Since peaking at above $14 per share back in late 2017, Challenger shares have been in freefall.

This is a company that bottomed out at $2.82 per share in just the past 12 months. That represents a loss of 80% over three years or so.

But the Challenger share price has staged a remarkable recovery in recent months. Challenger shares were trading at $3.63 back in mid-September last year. Today, those same shares are going for $6.55 at the time of writing. That’s a recovery of ~80% in just six months, not a bad return.

So what has breathed new life into this annuities company?

Well, to answer that question, we just need to look at how Challenger makes its crust in the first place.

So (as I just mentioned), Challenger provides annuities and other investment products like funds management. But annuities make up the lion’s share of its business. An annuity is a pension of sorts. You provide Challenger with a lump sum of capital, and in return, you receive a fixed percentage of that capital every year as a payment.

What makes annuities unique is the certainty they offer. Most investments don’t offer a guaranteed income, as we saw last year when many traditionally solid ASX dividend-paying shares reduced or axed their dividend payments. Likewise, a house or a property can provide rent, but tenants can always move out and pull the plug on your cash flow.

Annuities take that uncertainty away – in exchange for a lower yield than what you can expect from many shares and the like of course. There’s no free lunch.

A challenging time for Challenger shares

But Challenger has a difficult balancing act to pull off in order for it to make money. It has to invest its clients’ funds in investments itself in order to create a spread it can take profits from. And since it is required to pay a guaranteed income for its annuities, it has to make sure it doesn’t lose too much money.

Unfortunately for Challenger, the best risk-free assets – government bonds – have not had a good few years. The Reserve Bank of Australia (RBA) has been slashing interest rates progressively over the past few years (and aggressively last year). As such, government bond yields and cash interest rates have also been cratering.

Fortunately for Challenger though, the past few months have seen this situation reverse, and government bond rates rise substantially.

In November last year, 10-year Australian government bonds were yielding just 0.88% per annum. Today, those same bonds are instead offering 1.65%. At the same time, the S&P/ASX 200 Index (ASX: JXO) has been rising in tandem. As have ASX 200 dividends.

This might just be why the fortunes of the Challenger share price have been rising as well.

More reading

• Goldman reaffirms its conviction buy on this ASX share on Yallourn shutdown
• Morgans just added this ASX 200 share to its model portfolio
• Why ASX income investors should consider this dividend ETF
• ASX 200 up 0.95%: Afterpay rises, Westpac’s APRA update, Qantas upgraded
• 435,000 Aussies bought their first shares during the pandemic

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Challenger 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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The Sheffield Resources Ltd (ASX: SFX) share price is soaring on the back of a late market release. The mineral exploration company announced that it has completed the joint venture agreement with YGH Australia Investment Pty Ltd (Yansteel).

For most of the day, the company’s shares were trading relatively flat. However, upon the news breaking on the ASX, the Sheffield share price accelerated to 42.5 cents.

At the time of writing, Sheffield shares have retreated back to 41 cents, up 13.89% with only moments of trading left for the week.

What’s driving the Sheffield share price higher?

The Sheffield share price is racing higher as investors look ahead to the company’s attractive prospect.

In its announcement, Sheffield advised that it’s finalised the transaction with Yansteel under the Share Subscription Agreement and Shareholders Agreement. With securing approval from the project’s lenders, and Yansteel’s $130.1 million investment, Kimberley Mineral Sands Pty Ltd is now jointly-owned.

The strategic partners will focus on completing a final bankable feasibility study for the Thunderbird project. The report will assess an in-depth review of project potential in terms of minable resources and revenue that can be generated. Should all go according to plan, the final investment decision will occur sometime later this year.

Kimberley Mineral Sands is working with Taurus Funds Management and the Northern Australia Infrastructure Facility in regards to the project financing.

Board restructure

As a result of the ongoing developments, Sheffield has appointed experienced mechanical engineer Mr Gordon Cowe as an independent non-executive director. Mr Cowe has over 30 years of knowledge in leading and managing resources construction projects. He has worked with leading contractors such as Bechtel and Worley Parsons, on a number of projects.

While the board acquires Mr Cowe’s services, joint venture founding directors Mr Will Burbury and Mr David Archer have resigned. The expected outcome has enabled management to now focus on positioning the company to progress its Thunderbird project.

Words from the managing director

Sheffield managing director Bruce McFadzean hailed the milestone achievement, saying:

Our partnership with Yansteel is a great moment for Thunderbird, the people of the Kimberley, and for Sheffield Resources’ investors and stakeholders. We welcome our newly formed partnership with Sheffield and very much look forward to developing the Thunderbird Mineral Sands Project which will provide benefits for all stakeholders.

On behalf of the Board, I extend a warm welcome to Gordon, whose skills complement the next phase of Sheffield’s growth through the development of the Thunderbird Mineral Sands Project. At the same time, I sincerely thank Will and Dave for their achievements in discovering and establishing Thunderbird as a world class project.

The Sheffield share price has gained more than 350% over the past 12 months, but only around 6% year to date.

More reading

• Why this ASX retail share is tipped as “tremendous”
• Why the Corporate Travel Management (ASX:CTD) share price just hit a 52-week high
• Goldman reaffirms its conviction buy on this ASX share on Yallourn shutdown
• Why this ASX 200 tech share is leading the pack this week
• How ASX tech investors can ride the resurgent Nasdaq share boom

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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