News

Argonaut welcomes Tony Locantro

Argonaut is delighted to announce the appointment of Tony Locantro as a Dealer, Private Clients in our Securities Team with effect from Monday 18 May 2015. Tony began his career working in the NSW and QLD Police Service before gaining experience as a private client advisor, working at a number of stockbroking firms including William Noall and Patersons Securities.

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Morning Notes

The Nasdaq has bolted to a fresh record peak in a broad-based Wall Street rally that largely reversed sharp losses in the prior session. The tech-rich Nasdaq Composite Index jumped 73.84 points (1.47 per cent) to 5,106.59 on Wednesday, almost 15 points above the prior record set on April 24. The Dow Jones Industrial Average rose 121.45 points (0.67 per cent) to 18,162.99, while the broad-based S&P 500 gained 19.28 points (0.92 per cent) at 2,123.48.

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Latest Research

Independence Group (IGO) has executed a binding deed to acquire Sirius Resources (SIR), whereby SIR shareholders will receive 0.66 IGO shares and $0.52 cash for every SIR share. In conjunction with the takeover, SIR will receive script in a new listed vehicle called S2 Resources containing Polar Bear and Scandinavian assets. Excluding S2, this transaction valued SIR at $4.38/sh based on IGO’s closing price prior to the announcement. At yesterday’s closing price the market values the IGO bid for SIR at $3.92. This valuation is highly accretive to SIR shareholders relative to last close ($3.24) and Argonaut’s valuation of $3.62. Argonaut considers the transaction to be dilutive for IGO on an EV/EBITDA basis (IGO 3.8x vs transaction value 5.4x) and on a NAV/sh basis (decreasing from $4.90 to $4.75). However, we regard the transaction to be positive for IGO in the long term, transforming earning / scale and enhancing investment appeal.

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