Mineral Deposits Limited [ASX:MDL] has seen rapid share value growth, after French mining company, ERAMET have announced a takeover offer yesterday.
Mineral Deposits shares have grown by 25.86%, now trading at $1.46 a share. That’s at the level of the takeover offer.
Eramet extends their offer while Mineral Deposits shares surge
All acquired shares in Mineral Deposits Limited are on the table. Eramet have extended a market takeover proposal to the mining group.
The offer will enable consolidation of the joint venture that took place back in 2011.
The offer brings an attractive boost to MDL’s trading prices for shareholders. It also offers shareholders a certainty of cash return, as MDL’s shares aren’t too consistent with gains.
MDL have gone through a strong first quarter. Their consistent operating performance has surged with great momentum and is expected to continue to grow throughout the year.
High quality zircon has increased in value by about 15% during the end of 2017.
Further pressures of zircon supply are expected to rise during the year.
Mineral Deposit Limited announced in their quarterly report:
‘Positive demand in the titanium dioxide sector is evident with high pigment plant utilisation rates and relatively low inventory levels. Current pressures on the supply‐side are impacting the ability of the industry to supply existing customers, much less respond to any increase in demand. Pressure on both supply and price are likely to persist in the near‐term.’
MDL have a strong outlook for 2018. They are focusing on continuing the productivity of their operations while taking advantage of strong market conditions.
Despite that, with the price rapidly rising more than 25% today, before levelling off at the takeover offer price, it seems safe to say that today’s rapid rise is entirely due to ERAMET’s offer.
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