In morning trade, the iron ore giant's shares are up 3% to $19.17.

Why are Fortescue shares rising?

As well as getting a lift from a rising share market, investors have responded positively to an update on a proposed acquisition.

As readers may be aware, last week Fortescue had a takeover offer for Red Hawk Mining Ltd (ASX: RHK) accepted.

Fortescue made an offer which came with two prices. It started at $1.05 per share and then would increase to $1.20 per share if it acquired a relevant interest in 75% or more in Red Hawk shares within seven days.

The good news for Red Hawk shareholders is that Fortescue has now reached its target interest, which means that the offer price is now finalised at $1.20 per share. It said:

Fortescue is pleased to announce that it has, as of 4 February 2025, acquired a relevant interest in over 75 per cent of the fully paid ordinary shares in Red Hawk. Accordingly, as per the terms of the Offer, the offer price will be increased from A$1.05 to A$1.20 per Red Hawk Share (Increased Offer Price). Red Hawk shareholders who have already accepted the Offer will also receive the benefit of the Increased Offer Price.

The key to achieving this was the acceptance of the offer by two major shareholders. In a separate announcement, Red Hawk revealed:

Red Hawk's largest shareholders TIO (NZ) Limited (Todd) and OCJ Investment (Australia) Pty Ltd (OCJ) have now both accepted the Offer. As at 24 January 2025, Todd held 60.71% and OCJ held 21.20% of Red Hawk Shares. With the addition of other Red Hawk shareholders accepting the Offer, this results in FMG now holding a relevant interest in Red Hawk Shares of approximately 78.00%.

Red Hawk once again highlights that its board continues to unanimously recommend that Red Hawk shareholders accept the offer at the increased offer price.

This is in the absence of a superior proposal and subject to the independent expert continuing to conclude that the offer is fair and reasonable, or not fair but reasonable to Red Hawk shareholders.

Why Red Hawk?

It seems that Fortescue is wanting to grow its iron ore production in Western Australia and likes the look of Red Hawk's Blacksmith Iron Ore Project.

It is an undeveloped iron ore project located 30 kilometres west of Fortescue's Solomon operations in the Western Hub. The total Blacksmith mineral resource estimate is 243 million tonnes at 59.3% Fe grade.

The post Fortescue shares charge higher on Red Hawk takeover boost appeared first on The Motley Fool Australia.

In morning trade, the iron ore giant's shares are down slightly to $18.58.

This follows news that the miner has signed an agreement to acquire a fellow ASX mining stock.

Fortescue shares lower on acquisition news

According to the release, Fortescue has had an offer to acquire Red Hawk Mining Ltd (ASX: RHK) accepted this morning.

Fortescue's offer proposes to acquire all of Red Hawk's shares for a cash consideration of $1.05 per share. This represents a 28% premium to where its shares last traded.

In addition, the offer will increase to $1.20 per share if Fortescue acquires a relevant interest in 75% or more in Red Hawk shares within seven days, by way of an off-market takeover bid. This would be a 46.3% premium to its last close price and values Red Hawk at $254 million.

The good news for Fortescue is that Red Hawk's board of directors has already obtained an independent expert's report from BDO Corporate Finance, which concludes that the offer is fair and reasonable to shareholders.

As a result, the Red Hawk board unanimously recommends that shareholders accept the offer at both the offer price and the increased offer price. This is in the absence of a superior proposal and subject to the independent expert continuing to conclude that the offer is fair and reasonable.

It highlights that the "Offer represents a significant and attractive premium to the market value of Red Hawk. The cash consideration under the Offer delivers immediate value to Red Hawk shareholders and provides certainty, noting the significant risks to the development of greenfield iron ore projects."

What is Red Hawk?

Red Hawk is the owner of the Blacksmith Iron Ore Project.

It is an undeveloped iron ore project located 30 kilometres west of Fortescue's Solomon operations in the Western Hub. The total Blacksmith Mineral Resource estimate is 243 million tonnes at 59.3% Fe grade.

It revealed that Fortescue was one of 17 parties that showed an interest in the Blacksmith Iron Ore Project. The company said:

In total through the process, Red Hawk engaged with 17 parties, including international groups, financiers, iron ore producers, steel mills and commodity traders. […] From this process, the Offer from FMG emerged as the most compelling offer Red Hawk has received and, in the estimation of the Board, provides superior value to Red Hawk pursuing development of the Blacksmith Project independently as contemplated by the PFS.

Red Hawk's Chair, the Hon. Cheryl Edwardes AO, adds:

"Whilst we firmly believe that the Blacksmith Project has the potential to be a major iron ore project, there is significant cost, time and risk associated with developing a project of this scale, particularly in the context of an uncertain broader global economic outlook. As such, the Board believes that the Offer provides shareholders with a compelling opportunity to de-risk their investment and realise certain value at an attractive premium to historical trading levels leading into the announcement of the Offer."

The post Fortescue shares slide on $254m Pilbara acquisition appeared first on The Motley Fool Australia.

For perspective, the S&P/ASX 200 Materials Index (ASX: XMJ) rose 1.94%.

Let's take a look at what may have caused these three ASX mining shares to reach for the stars.

Southern Palladium

The Southern Palladium share price exploded 21% higher, closing on Monday at $1.15. The monster trading day came after the company updated the market on drilling progress at its Bengwenyama PGM project.

Southern Palladium has a 70% stake in the palladium and rhodium-rich project located at the Bushveld Complex in South Africa.

The explorer advised that drillhole E062 had intersected the first UG2 reef at 31.2m below the surface. Commenting on the news, managing director Johan Odendaal said:

Confirmation of the UG2 Reef intersection is an important early barometer for the company as it advances the Phase 1a drill program.

Arafura Resources

The Arafura Resources Ltd (ASX: ARU) share price also shot the lights out today, surging 17.24% to close at 34 cents.

Arafura has been added to the ASX 300 Index as part of a quarterly rebalance. S&P Dow Jones Indices advised of the changes to multiple S&P/ASX indices after market close on Friday.

Arafura is developing the Nolans Rare Earths Project in the Northern Territory. The mineral explorer aims to supply 5% of the world's neodymium and praseodymium (NDPr) 99% pure oxide from the Nolan's project.

Flinders Mines

Finally, the Flinders Mines share price soared a whopping 41.51% today to 75 cents at the close.

Flinders advised the market this morning that BBIG Group Pty Ltd had terminated a farm-in agreement with it. This meant Flinders would be able to negotiate a staged development of its Pilbara Iron Ore Project in Western Australia.

The company's chair Cheryl Edwardes said the move would provide Flinders with a "more certain pathway to near term cash flow".

The post 3 ASX mining shares that rocketed more than 15% on Monday appeared first on The Motley Fool Australia.

The Flinders Mines Ltd (ASX: FMS) share price soared 41.51% today to close at 75 cents.

Let's take a look at why this ASX iron ore share had such a good day.

Iron ore development news

Investors bought up Flinders Mines shares after the company advised a farm-in agreement with BBIG Group Pty Ltd had been terminated.

This will enable Flinders to negotiate a staged development of its Pilbara Iron Ore Project in Western Australia.

Stage one will involve a lower volume, near-term trucking operation to "take advantage of iron ore prices" and provide cash flow.

Flinders will also keep looking into stage two, a higher volume operation involving the use of rail, road, and port.

Commenting on the news, Flinders chair Cheryl Edwardes said:

The FIA termination provides Flinders with a more certain pathway to near term cashflow as we attempt to capitalise on current iron ore prices and pursue a less capital intensive, nearer-term mining and logistics solution.

Flinders said there will be one final shortfall payment of about $10 million.

Share price snapshot

The Flinders Mines share price has fallen around 15% in the past year. However, year to date, it has surged 32%. The company's shares have gained 50% in the last month alone.

For perspective, the S&P/ASX 200 Materials Index has fallen 7% in the past year.

Flinders Mines has a current market capitalisation of nearly $127 million.

The post Guess which ASX iron ore share rocketed 40% on Monday appeared first on The Motley Fool Australia.

Four shares that have defied the market and pushed higher today are listed below. Here's why they are on the rise:

AGL pulls the plug on Vocus deal.  

The AGL Energy Limited (ASX: AGL) share price has pushed 2% higher to $19.90 after pulling out of a deal to acquire telco company Vocus Group Ltd (ASX: VOC). Following a short period of due diligence, the energy retailer wasn't convinced that the deal would add value for its shareholders. Judging by the share price gain, AGL's shareholders appear to be pleased with the decision.

Emeco continues its charge.

The Emeco Holdings Limited (ASX: EHL) share price has risen 9% higher to $1.93. The shares of the leading provider of equipment leasing to the earthmoving industry have been on the charge since providing a trading update last week. That update revealed that the company has continued to experience strong demand for its services and expects to deliver operating EBITDA in the range of $211 million to $213 million in FY 2019. This will be an increase of almost 40% on FY 2018's result.

Flinders Mines on fire.

The Flinders Mines Limited (ASX: FMS) share price has been on fire on Monday and is up 36.5% to 7.1 cents. This morning the company announced a board renewal and strategic path forward. In respect to the latter, Flinders has completed an internal review to identify the best path forward to progress the PIOP and unlock value for all shareholders. One of the potential options is the BBIG Project, which is associated with Flinders' largest shareholder, TIO (NZ).

Nanosonics compared to blue chip peer.

The Nanosonics Ltd (ASX: NAN) share price is up over 5% to $5.19 after the infection control specialist was compared to Cochlear Limited (ASX: COH). According to the AFR, the head of Australian equities research at Yarra Capital Management, Katie Hudson, believes Nanosonics shares a number of characteristics with Cochlear. These include a large addressable market, global technology leadership, and dual revenue streams.

The post Why AGL, Emeco, Flinders Mines, & Nanosonics shares pushed higher today appeared first on The Motley Fool Australia.

Four shares that have acted as a drag on the market today are listed below. Here's why they have started the week in the red:

The Asaleo Care Ltd (ASX: AHY) share price has fallen 7% to $1.33 after the release of a broker note out of Credit Suisse. According to the note, the broker has downgraded the personal care products company's shares to an underperform (sell) rating with a $1.30 price target. Due partly to rising pulp costs, its analysts have downgraded their earnings estimates for Asaleo Care through to 2020.

The Flinders Mines Limited (ASX: FMS) share price has returned to trade with a 16% decline to 8.4 cents. This morning Flinders Mines announced that it was retracting its production target at the Pilbara iron ore project and provided a summary of its maturation programme findings. In respect to the latter, base case metallurgical processing test work indicates that the project detrital resource material experiences significantly lower yields than non-detrital ores.

The Somnomed Limited (ASX: SOM) share price has tumbled over 7% to $2.53 despite there being no news out of the sleep treatment company. At one stage SomnoMed's shares were down as much as 10.5% to a 52-week low of $2.45. Its shares have come under pressure this year after a weaker than expected first-half result due to the underperformance in its core business in North America and a slower than expected take off trajectory of all Renew Sleep Solutions centres.

The Wattle Health Australia Ltd (ASX: WHA) share price has fallen 27% to $1.65 after returning to trade after a six-week suspension. This morning Wattle Health announced a $77.9 million funding package for the Corio Bay Dairy Group joint venture with Organic Dairy Farmers of Australia. $37.9 million of this will be raised through a 1 for 5 pro rata non-renounceable entitlement offer at $1.25 per share. This is almost 45% lower than the last close price.

The post Why these 4 ASX shares have started the week in the red appeared first on The Motley Fool Australia.

Source: CommSec  

*Please note, I have excluded shares with a market capitalisation of less than $80 million.

Unfortunately, it would be very difficult to consider any of the shares listed above as investment grade material.

In fact, it is pretty clear that most investors should steer well-clear of the shares above considering that not a single company managed to turn a profit over the past year. On top of that, it is hard to envisage any of these companies as having the ability to pay out a dividend anytime soon.

Nonetheless, there are some interesting companies on that list and it is not hard to see why some traders may be interested in them.

For example, Auscann and MMJ Phytotech operate in the medical marijuana sector and perhaps have the most credible prospects of those listed on the ASX. There is no doubt that the sector could be highly lucrative, but it still remains unclear exactly how these companies will develop a long-term competitive advantage.

Uranium, cobalt, lithium, gold and iron ore miners are also represented in the list above. Cobalt and lithium shares have been particularly popular over the last few months as some analysts have forecast huge demand for these minerals as a result of the growing demand for rechargeable batteries. Unfortunately, many of these smaller players are competing against much larger competitors who are likely to bring a higher level of expertise and scale to their operations.

Finally, Sky and Space Global is an exciting company that is developing nano-satellite technology aimed at providing telecommunications services to over 4 billion people. The company has an ambitious target of rolling out around 200 satellites over a five-year time frame, but with only three satellites contracted so far, this target seems a like a universe away.

The post Should you buy the best performing shares of 2017? appeared first on The Motley Fool Australia.

Atlas Iron Limited (ASX: AGO), BC Iron Limited (ASX: BCI), Mount Gibson Iron Limited (ASX: MGX), Grange Resources Ltd (ASX: GRR), Arrium Limited (ASX: ARI), Mineral Resources Limited (ASX: MIN) and US-listed Cliffs Natural Resources have all been named as producers facing production cuts over the next few years due to depletion of some of their mines as well as the unsustainability of some of their mines at low prices.

"Whether driven by price or depletion we expect the number of iron ore companies in Australia to dwindle by the end of the decade," says Citi.

At the same time, the big miners Rio Tinto Limited (ASX: RIO), BHP Billiton Limited (ASX: BHP), Fortescue Metals Group Limited (ASX: FMG) and Hancock Prospecting are all expected to increase production over the long term. Hancock Prospecting's Roy Hill is still ramping up to full production of 55 million tonnes a year, having begun operations late last year.

Citi also raised its forecasts for the commodity price for this year from US$47 a tonne to US$49 a tonne, and projected 2017 would average US$42 – up from their previous forecast of US$39 a tonne.

The investment bank says it remains bearish on the iron ore – despite the short-term upside thanks to better-than-expected Chinese steel output. The bank's forecasts for 2018 and 2019 are for US$38 a tonne and a modest recovery in 2020 to US$40 a tonne.

Here's what the iron ore price has been doing over the past 3 years.

Those prices would be bad news for the juniors – generally higher cost- producers, and probably spells the end of a number of junior iron ore explorers hopes of coming to market. Those include Brockman Mining, Iron Road Limited (ASX: IRD), Flinders Mines Limited (ASX: FMS), Red Hill Iron Limited (ASX: RHI) and API Management –  which holds a number of joint ventures in the Pilbara.

Foolish takeaway

Given the current commodity price, iron ore mines need to be massive in scale with many years of reserves to get their production costs down – ala Roy Hill. That makes it incredibly difficult for the junior miners and explorers to commercialise their projects and then survive for many decades.

Investors beware.

The post Can the junior iron ore miners survive? appeared first on The Motley Fool Australia.