wah nam shenningans, page-22

I reckon FMG and AGO are already in discussion about a merger to fend off predators but the motivation behind the merger would primarily be to leverage each other's strengths like AGO's port allocation and FMG's rail. With Twiggy's 32% ownership in FMG, the board of the 2 companies plus many long termers who want to see both companies ramp up, a blocking stake is guaranteed.

The QRN path IMO will never get up. Spending billions building another rail line parallel to FMG rail is pretty mindless. AGO's admission of vulnerability is sending some kind of message to the market IMO. Either it is flushing out the highest bidder or it is flagging a AGO-FMG future.

The implication to BRM is unclear. Denial of a rail deal by FMG to BRM in the contect of a FMG-AGO merger is the perfect excuse). This would be a perfect excuse for the PHA to have BRM surrender the port allocation if they cannot commit to a deadline of when they will utilize the port. Without rail, that's a given. Mr Luk must be very nervous that the loot stolen from poor BRM holders turns out to be fools gold. Without the port allocation, BRM is worth nothing if rail is denied.

Try reading between the lines of what Twiggy says.

http://www.bloomberg.com/news/2012-05-03/fortescue-open-to-iron-ore-rail-talks-with-atlas-forrest-says.html

“Should they build another huge railway line when there’s already an independent operator - by all means, that’s the market place,” said Forrest. “But there’s certainly an existing rail and an existing port.”