Rex Minerals [ASX:RXM] Soars 60% on Takeover Bid from MACH Metals


Rex Minerals has jumped today after a takeover bid by Indonesian giant Mach Metals, is now the time to invest?

Shares in copper explorer Rex Minerals [ASX:RXM] have skyrocketed today as investors react to news of a $393 million takeover offer from major shareholder MACH Metals Australia.

As of this writing, Rex shares are up over 60% since yesterday’s close, soaring above the broader ASX 200 index, which has remained muted today.

The surge comes as MACH Metals, a subsidiary of Indonesian conglomerate Salim Group, offers to acquire all outstanding shares in Rex for 47 cents each.

Before today’s huge gains, the company’s stock was up +22% in the past 12 months and had traded at 27.5 cents.

Now, the company is trading at around 44 cents after seeing over five times its normal trading volume today.

Source: TradingView

MACH Metals’ Takeover Bid

The takeover offer from MACH Metals Australia is a welcome development for Rex in its global partnering search.

The company has been aiming to secure funding for its flagship Hillside copper project in South Australia.

MACH Metals, which already holds a 15.8% stake in Rex, is offering to acquire all remaining shares at a significant premium.

The offer represents a 79% premium to Rex’s 30-day volume-weighted average price of $0.26, a 98% premium to the 90-day VWAP of $0.24, and a 176% premium to Rex’s most recent entitlement offer price of $0.17 in January.

In a statement to shareholders, Rex Minerals’ CEO Richard Laufmann said:

This transaction provides certainty of value as well as the opportunity for shareholders to realise their investment at a 10-year historical share price high.

The Rex board has also recommended that shareholders vote in favour of the takeover, saying the share price premium and MACH’s financial strength ‘is in the best interests of Rex shareholders’.

The Hillside project, which is at the centre of this takeover bid, is one of Australia’s largest undeveloped copper projects.

It boasts a mineral resource of 337 million tonnes at 0.56% copper and 0.14 grams per tonne of gold — totalling 1.5 Moz gold and 1.9Mt of copper.

MACH Metals’ managing director, Ferdian Purnamasidi, highlighted the strategic importance of the acquisition, saying:

The Hillside project aligns with our strategy to diversify our asset portfolio. Our strong focus on copper is critical to the energy transition process.

Is this an opportunity for investors, or will these share moves reverse course once the dust settles?

Outlook for Rex Minerals and the Copper Sector

For current Rex shareholders, some may be happy to book today’s gains and find another junior explorer for the current merger and acquisition (M&A) cycle.

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While there may be some more space for this stock to run thanks to the 47-cent offer, for many, it could be a welcome relief to see its projects move forward.

The Hillside project is located on prime farmland in central Yorke Peninsula, only 9km from a popular holiday beach in South Australia.

Locals have long opposed the project, but the SA government has given it the go-ahead, awarding all required approvals.

As Rex CEO Richard Laufmann assured today, saying:

The South Australian Government has been a leader in Australia in support of decarbonisation and copper development. The successful development of Hillside will very much align with their strategy.

This takeover comes at a time when copper is increasingly seen as a critical metal for the global transition to renewable energy.

Electric vehicles, wind turbines, and solar panels all require significant amounts of copper, potentially driving demand in the coming decades.

However, investors should be cautious about reading too much into today’s gains.

Even with MACH’s potential financial backing, REX’s road to development is still a long one, and it could see legal battles before spades hit the dirt.

Thankfully, copper prices have reversed their downward trend since prices peaked in late May, giving copper miners some room to run.

For investors late to this stock jump, it might be worth considering other players for now. 

Find stocks that could rule the new mining boom

Finding stocks like REX Minerals before they jump is the goal of any junior mining investor.

It can sometimes feel like playing the roulette, hoping that one day your stock is picked.

At Fat Tail we searched to find the next major mining disruptors and have come up with five stocks.

Our resident expert, geologist James Cooper has picked what he thinks are the next five stocks you want to consider in the coming Aussie mining boom.

While we can’t guarantee they will have a day like Rex today, they could define your investments in the future.

Click here to learn more about the Five stocks you may want to hold next.

Regards,

Charlie Ormond

For Fat Tail Daily

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You and your money are about to
go on the mother of all nostalgia trips…

Australia’s

DECADE OF DECIMATION

Is Staging a Comeback

The economic nightmare of
the 1970s is on the way back

Protect your wealth now

All advice is general advice and has not taken into account your personal circumstances.

Please seek independent financial advice regarding your own situation, or if in doubt about the suitability of an investment.

With more than a decade of fintech experience, including stretches in critical roles at budding start-ups and tech titans like Microsoft, Charles is squarely focused on investment opportunities in emerging sectors. Interestingly, his academic foundation in zoology provides an unexpected edge! He applies his scientific training with his analytical mindset to figure out tomorrow’s winners and losers. While traditional institutions stick with ‘safe’ stocks, Charles goes straight for seismic shifts in crypto and AI. He’s an early adopter of both technologies.

Now he’s on a mission to empower everyday investors. He decodes groundbreaking developments in technology stocks before they grab mainstream attention. So, if you seek an unconventional perspective to help capitalise on what’s next in fintech, look no further.



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