african minerals appears to be upping its stake - possible takeover / offer?

Another good move up today now 16.75 / 17.50p +0.625p

spread 14 / 14.50p

Signs on the chart and Level 2 of wanting to go higher from here. Lots of buying on bigger size and earlier paying premium.

Marked down at the start with the market, level 2 of 2 v 1

If finishing higher than the opening price the candlestick ( hammer ) would be bullish for the chart

as money am charts are allways behind here are others on time

Baobab makes the grade in Mozambique
By Mark Robinson, 24 November 2011


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Baobab Resources PLC (uk:BAO)
SPECULATIVE
HIGH RISK
Bull points
Established infrastructure
Reliable power access
High ore grades
'First-mover' status
Bear points
Risk of political instability
High capital expenditure
Think of Southern Africa's producers of bulk commodities, and it's unlikely that Mozambique would readily spring to mind. But a small Aim-traded miner with big ambitions is seeking to change all that.
Baobab Resources has achieved 'first-mover' status in Mozambique through four prospects in the central-north of the country. Mozambique's mineral profile was previously woefully inadequate, partly because in large parts of the country almost no modern exploration techniques had been deployed, but also because the mining industry was held back by two decades of civil war. The potential for political instability still presents a risk factor, but almost five years after joining Aim, Baobab has made significant headway towards establishing a commercial resource base and opportunities abound.
The main focus for the company is its flagship Tete iron ore project, which shares licence boundaries with two coal operations owned by Vale , Rio Tinto , and India's Tata Group . The proximity of these projects to Baobab's Tete project is hugely advantageous because port and rail links are already in place and there are substantial new infrastructure plans in development, including an upgrade in rail capacity and plans for a barge network down the Zambezi River. The Zambezi provides Baobab with access to reliable, low-tariff hydro-electric power a factor that can't be taken for granted on the 'Dark Continent'. The potential importance of the Tete project to the local economy can be gauged by the fact that the World Bank, in the form of its commercial arm the International Finance Corporation has entered into a strategic partnership with Baobab and has a 15 per cent stake in the project.
BAOBAB RESOURCES (BAO)
ORD PRICE: 14.38p MARKET VALUE: 27m
TOUCH: 14.25-14.5p 12-MONTH HIGH: 56p LOW: 10p
DIVIDEND YIELD: nil PE RATIO: na
NET ASSET VALUE: 2.6p NET CASH: 5.7m
Year to 30 Jun Turnover (m) Pre-tax profit (m) Earnings per share (p) Dividend per share (p)
2008 nil -2.19 -3.80 nil
2009 nil -1.55 -1.86 nil
2010 nil -1.96 -1.38 nil
2011 nil -6.06 -3.61 nil
2012* nil -2.46 -1.10 nil
% change - - - -
Normal market size:25,000
Matched bargain trading
Beta:1.46
*Estimates by Edison Investment Research
Baobab's managing director, Ben James, reckons that the company is "rapidly approaching a watershed in the development of the Tete project", because a pending resource statement from the Ruoni South prospect within Tete should ensure that Baobab will meet or exceed its 300m tonne iron ore resource target. An additional resource statement based on current work at the adjacent Tenge prospect is scheduled for release early next year, and Baobab anticipates that this will push its resource inventory well beyond the base requirements needed to secure investment and accelerate Tete towards the commercial planning stage. Baobab's next most advanced project is the Monte Muande magnetite phosphate deposit, located 25km northwest of Tete, with a 200m-250m tonne exploration target.

But unlocking Mozambique's mineral wealth won't come cheap. Mr James estimates a $500m (318m) capital expenditure bill for Tete alone, so Baobab's share in the project is likely to be diluted over time. The most direct route towards commercialisation would be to simply sell the proved assets at Tete, or perhaps bring in a partner with sufficient financial clout to see it through to production. Given the strong port and rail links already in place, and a short easterly sea-route to India, a prime candidate might be Tata Group, the world's seventh-largest steelmaker. Baobab has 5.7m in cash to progress Tete towards commercialisation, in addition to a 15m unused drawdown equity facility, so the company has sufficient resources to enable it to make a measured decision on the Tete resource when the time comes.
SHARE TIP SUMMARY:
It's also conceivable that Baobab itself could be subject to a takeover bid but, even without factoring in merger and acquisition activity, the company's valuation as a standalone entity is attractive. A recent conservative valuation by investment research provider Edison values the shares at 23.6p, around 60 per cent more than the current price, using a sector average price of $1.02 per tonne for its existing inferred resource of 267m tonnes of iron ore at a 29.4 per cent grade (Ruoni North actually averages 34.6 per cent). In other words, using a worst-case scenario that doesn't factor any further growth in Baobab's resource base (a highly unlikely scenario), the shares are trading almost 40 per cent below fair value estimates. Buy.
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Further good news today and share price rise 15 / 15.50p +1.125p

TENGE DELIVERS 159Mt, EXPANDING GLOBAL RESOURCE INVENTORY TO 482Mt -- 5 MARCH 2012

Tenge adds 159m tonnes to Baobab's Tete resource base

Baobab Resources increased the resource base at its Tete iron/vanadium/titanium project in Mozambique tenfold in 2011.

Baobab started 2011 with a resource base of 48m tonnes and this had now increased to 482m tonnes - far outstripping the company's original 300Mt target.

Baobab said the Tenge prospect had added an additional 159m tonnes 'inferred' resource at a head grade of 38.4% Fe and an average concentrate grade of 60.4% Fe, 0.8% V2O5 and 12.5% TiO2 at a mass recovery of 47.6%.

Coffey Mining has been commissioned to complete an exploration target assessment of the resource potential underlying the 'Flats' area of Tenge/Ruoni.

Baobab managing director Ben James said: "The Tenge resource statement is the culmination of the 2011 drilling programme.

"Baobab started 2011 with a resource base of 48m tonnes and has increased it tenfold to 480m tonnes, far outstripping the company's original 300m tonnes target.

"The project has made the transition from one of exploration to one of development and is strategically located in the emerging mining hub of the Tete province, Mozambique, one of Africa's fastest developing economies, with unique access to existing and expanding power and infrastructure as well as abundant coal reserves."

DO they have funding to use these or are going to issue shares, etc?

ahoj

re - funding

Sure you will have to ask the management that, or what is their plans, to extract the findings or passed it on to a larger company.

In the meantime I play short term, so I did sell my punt soon after my post as the MMs were paying a very good premium to bid price ( above middle price ).

other reasons was SP over Higher bolinger Band, Indicators around the overbought territory and my % gain was on my target 20% ( not to bad for less than 3 weeks ( 17 February)

Hey guys, I found this link of an audio interview with Baobab Resources and wanted to share it with you guys.

Its well worth a click:

http://www.brrmedia.co.uk/event/98087/ben-james-managing-director

bao wow = dog

why don't you F*** off js8

there are a couple of Pissing Dogs on this thread >>> SHAME

I dipped my toe on the stock today, everything seems just right for the bounce from the bottom floor 7p now 8p

What worries me about Baobab etc with iron ore and coal at Tete -

Iron ore and coal are a low cost and high volume products to transport
I do not think there is a sustantial local market for iron ore or coal anywhere
near Tete
Steel could be made from coal, iron ore, and limestone if a blast furnace
could be built, then they could export steel from Tete perhaps
Tete iron ore would be competing with iron ore which is much closer to
user markets i.e Ukrane for Europe, Australia for China, etc
They would need to transport the iron ore or coal for miles to the coast

Maybe I need to study the economics of Tete deposits, but at the moment
I just do not see it ?

Is it like finding gold on the moon ? Have a look on a map and find Tete.

What worries me about Baobab etc with iron ore and coal at Tete -

Iron ore and coal are a low cost and high volume products to transport
I do not think there is a sustantial local market for iron ore or coal anywhere
near Tete
Steel could be made from coal, iron ore, and limestone if a blast furnace
could be built, then they could export steel from Tete perhaps
Tete iron ore would be competing with iron ore which is much closer to
user markets i.e Ukrane for Europe, Australia for China, etc
They would need to transport the iron ore or coal for miles to the coast

Maybe I need to study the economics of Tete deposits, but at the moment
I just do not see it ?

Is it like finding gold on the moon ? Have a look on a map and find Tete.

Audio interview with Ben James, Managing Director
Ben James, Managing Director gives an update on the final year results, forthcoming pre-feasability study and financing potential.

Click the link below to listen:

http://www.brrmedia.co.uk/event/106741/ben-james-managing-director

Audio interview with Ben James, Managing Director of Baobab Resources. The Company is very pleased to present the Ruoni Flats resource statement. Baobab is now able to realistically consider significantly larger production options at Tete, with the expanded 490Mt Tenge/Ruoni resource base sufficient on its own to underpin a 4Mtpa Pig Iron operation over an impressive life of mine of c.35 years
Click the link below to listen:
http://www.brrmedia.co.uk/event/107071/ben-james-managing-director

I suggest you sell now at 12.75p

I agree that pig iron production is the way to go from Tete.
But the economics of getting it to ? Asia, etc I really do not know.

I think Baobab was funded and floated to explore mainly old Portugese
mining operations in Mocambique. It seems that gem stones, copper
and nickel have not yet been commercially found as intended, and they
have switched operations into Tete, where it was already known their were
quantities of coal. Do know about iron ore.

Looks like they will need to transport pig iron across Malawi, where they
would need to construct some rail line and repair some, or down the Zambezi
"corridor" to Beira somehow. Either journey is a good distance to the Indian
Ocean coast. Then ship to markets, probably in Asia.

Interesting ambitions, but far too much of a long shot for me.
Share price seems to be dropping back now

Baobab Resources presenting at Minesite.

Click the link to view:

http://www.brrmedia.co.uk/event/107075/ben-james-managing-director

i see this dog has started barking loudly once more, though unsure how justified

Like Cynic -
I just do not know or understand who is buying this share at this 16.50p price.
Good luck to them, but I am keeping well clear.

when i posted previously on 11/12, sp was 15.50 ...... it is now 19.75 ..... ride the momentum if you wish, but it remains a dangerous play