china friend or foe, page-7

The big risk is a re-run of other experiences with overseas buyers wanting the minerals.

An over 50% stake means they call the shots.

If they are owned by a parent company that wants the metal then they will sell to that parent company for well below market price, and as they have >50% other shareholders can do nothing about it (will be explained to other shareholders as a discount for the security of a long-term takeoff agreement). This suppresses profits of MOL to near zero, so they don't have to pay other shareholders much dividend, hence keeping profits for themselves.

Another scenario is that they sell the moly to a linked "wholesale" company at near cost with profits then made by the "wholesaler" which is 100% owned by the 56% owners of MOL.

Yet another scenario is they sell at a "landed" price in China which is the current market price, but use very expensive shipping (by a 100% owned company) that charges just the amount where MOL just scrape a tiny profit.

There are lots of ways to rip off other shareholders once you own over 50% - and being an OS company there is little recourse in Australian courts.

Sorry for the negative sentiment - but precedents have been set where exactly these types of thing has happened with overseas majority shareholders controlling resources.

The only benefit I could see going forward would be if they wanted to takeover the rest - but why would they want to when they call the shots and can