Mustang Resources — Focusing in on Caula Graphite and Vanadium

Mustang Resources — Focusing in on Caula Graphite and Vanadium

The recently announced A$10m asset-for-shares swap with Fura Gems shifts Mustang’s primary focus to the Caula Graphite and Vanadium Project, which is located along strike from Syrah Resources’ large graphite project. Maiden Caula graphite and vanadium resources reflect high grades (13.4% and 0.37%, respectively). The scoping study due in Q318 will provide investors with insight into project economics, but the good grades and positive graphite metallurgical test results to date are encouraging signs. Trial mining could generate first revenues by mid-2019.

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Written by

Mustang Resources

Focusing in on Caula Graphite and Vanadium

Introductory note

Metals & mining

24 July 2018

Price

A$0.02

Market cap

A$18m

US$0.73/A$

Net cash (A$m) at 31 March 2018

2

Shares in issue

959m

Free float

88.8%

Code

MUS

Primary exchange

ASX

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

11.8

(20.8)

(65.2)

Rel (local)

10.0

(26.0)

(68.3)

52-week high/low

A$0.18

A$0.02

Business description

Mustang Resources is an exploration and development company with two primary projects, both in Mozambique: the advanced Montepuez ruby project (currently subject to a proposed asset for shares transaction with Fura Gems) and the Caula Graphite and Vanadium project.

Analyst

Alison Turner

+44 (0)20 3077 5700

Mustang Resources is a research client of Edison Investment Research Limited

The recently announced A$10m asset-for-shares swap with Fura Gems shifts Mustang’s primary focus to the Caula Graphite and Vanadium Project, which is located along strike from Syrah Resources’ large graphite project. Maiden Caula graphite and vanadium resources reflect high grades (13.4% and 0.37%, respectively). The scoping study due in Q318 will provide investors with insight into project economics, but the good grades and positive graphite metallurgical test results to date are encouraging signs. Trial mining could generate first revenues by mid-2019.

Year end June

Revenue (A$m)

PBT*
(A$m)

EPS*
(c)

DPS
(c)

P/E
(x)

Yield
(%)

06/16

0.0

(5.50)

(8.3)

0.0

NA

NA

06/17

0.0

(3.17)

(2.8)

0.0

NA

NA

Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.

Montepuez to be merged into Fura Gems

Mustang Resources has announced a proposed A$10m transaction whereby Mustang will contribute its Montepuez ruby project into Fura Gems (FURA.TSX) in return for three tranches of shares in Fura. The deal structure allows Mustang’s shareholders to retain an indirect interest, of around 8%, in a substantial combined ruby project in Mozambique, which stands to benefit from the injection of funding and additional marketing expertise by Fura. In addition, Mustang’s shareholders also gain exposure to Fura’s Coscuez emerald mine in Columbia, where bulk sampling is already underway.

Focus now centres on Caula graphite and vanadium

Hiving off the ruby assets allows Mustang to focus its attention and funds more fully on Caula – which is rapidly proving to be a high-quality graphite and vanadium resource. In parallel to the scoping study currently underway and due by the end of this quarter, Mustang intends to progress to trial mining and processing at Caula, with first graphite and vanadium concentrates planned for mid-2019.

Significant potential value at Caula

Based on applying peer-group in-situ resource multiples to Caula’s 2,933kt of contained graphite (24 July 2018 resource update) and 81.6kt of contained vanadium (20 July 2018 maiden resource update), we would value the Caula graphite resource at US$27.5m (A$37.5m) and the vanadium resource at US$16.8m (A$22.9m) for a total valuation for Caula of US$44.2m (A$60.3m). This does not take into account any potential upside should further drilling continue to increase the scale of this project.

Caula: Graphite and vanadium

Mustang’s Caula graphite and vanadium project is in Mozambique along strike from Syrah Resources’ Balama project, which is projected to supply 40% of the flake graphite market by 2020.1 The updated graphite resource at Caula (July 2018) confirmed the high-grade nature of the Caula deposit at 13.4% average total graphitic carbon (TGC), while the presence of significant vanadium (0.37% average V2O5) in the same deposit was confirmed by the recent maiden vanadium resource (July 2018). A scoping study on Caula is expected this quarter.

  Syrah Resources, Macquarie Bank Australia conference presentation, May 2018

Exhibit 1: Location of Caula and other graphite projects in the Montepuez District

Source: Mustang Resources – company announcement, 6 November 2017

Given the strong evidence of high-grade, near-surface graphite and vanadium mineralisation, Mustang made the decision in March to advance trial mining and processing in parallel to the scoping study on commercial-scale production. First production from trial mining is expected mid-2019. As well as generating revenue from the sale of the graphite and vanadium concentrate, trial mining and processing would generate detailed technical information for use in feasibility studies of full-scale project development and provide product samples for evaluation by potential offtake partners.

Resource update confirms high graphite grades (13.4% TGC)

Exhibit 2: Caula graphite resource (July 2018)

Source: Mustang Resources – Caula graphite resource update, 24 July 2018

In November 2017, Mustang announced a maiden graphite resource for Caula of 5.4Mt at 13.0% TGC based on the results of just six drill holes. The recent (24 July 2018) resource update added a further 11 drill holes as shown in Exhibit 3 below. Not only did this update increase the size of the resource to 21.9Mt, but the already high graphite grade also increased marginally to 13.4% TGC.

The particular strengths of the Caula graphite resource are that:

The graphite grade of 13.4% TGC compares to an average mined grade globally of just 4-6%.2

  Syrah Resources, International Battery Seminar presentation, March 2018

The company believes that there is potential to define additional graphite and vanadium mineralisation immediately adjacent to the Caula resource. The resource is currently open at depth and a new programme of diamond and reverse circulation drilling has been planned to test for both up-dip and down-dip extensions.

The Caula deposit lies within a broader 18km-long TEM anomaly and Mustang has identified several additional graphite-vanadium targets on this broader structure. Results from drill hole MODD010, which is located 7.5km south of the main Caula zone, returned 99m at an average grade of 12.56% TGC, supporting the hypothesis that the broader Caula project may host a large mineralised system. Mustang proposes to systematically drill test the TEM target through progressive step-out drilling from the Caula discovery.

The latest (25 June 2018) metallurgical test results from Caula were very positive, showing that the project could potentially produce 68% large to jumbo flakes from fresh ore and 60% from oxidised ore, while maintaining average TGC in the concentrate of 97%.

Exhibit 3: Caula drill hole locations

Source: Mustang Resources – company announcement, 24 July 2018

The graphite market is divided between natural graphite and synthetic graphite (produced from coke and pitch and tending to be of higher purity but not as crystalline as natural graphite). By end-use the largest segment is in refractory applications, but graphite is also used as anode material for lithium-ion batteries, which is a key demand growth area. Industry analysts Roskill forecast graphite demand growth of 5–7% per annum over the next 10 years, with demand from batteries to grow five to 10 times over that period.3

  https://roskill.com/market-report/natural-synthetic-graphite/

Natural flake graphite can be used for refractory applications, fire-resistant building materials, graphite foil (requiring high purity flakes and used in many high tech applications) and battery applications (using higher purity flakes to produce spherical graphite). Larger flakes and higher purity flakes attract a premium price which would benefit Caula as metallurgical tests have demonstrated that 63% of total production could fall in the large to jumbo size range at concentrate grades of 97% TCG. Graphite prices are highly dependent on grade and quality metrics and as such, not reflected in a single market index; however, strong price performance in recent years has reflected growing demand from battery applications.

Maiden Caula vanadium resource

Alongside the strong graphite mineralisation at Caula, the project also offers good vanadium grades from within the same orebody. On 20 July 2018, Mustang announced a maiden vanadium resource for Caula incorporating the six drill holes used to complete the November 2017 maiden graphite resource, as well as the 11 more recent scoping study drill holes (see Exhibit 3 for drill hole locations). The maiden resource totals 22Mt of measured resources at average grade of 0.37% V2O5 (81.6kt contained).

Exhibit 4: Caula vanadium resource (July 2018)

Source: Mustang Resources – maiden vanadium mineral resource announcement, 20 July 2018

The company believes that as the vanadium is associated with the graphite mineralisation it may be far cheaper to extract and process than the majority of producing vanadium projects, where the vanadium is located in a titaniferous magnetite ore body.4

  Mustang maiden vanadium resource announcement,20 July 2018

Preliminary metallurgical testwork at Caulahas shown that vanadium would report to tailings during the graphite flotation process At Balama, Syrah Resources was able to show that a combination of wet high intensity magnetic separation (WHIMS) for magnetic material and flotation of non-magnetic material could produce a concentrate grading >3% V2O5 overall. Chemical processing of that concentrate could produce a 98.5% V2O5 product.5. Preliminary metallurgical tests at Caula have suggested that (as at Balama) a portion of the vanadium could be recovered by WHIMS and additional vanadium recovered from the WHIMS tailings by froth flotation. This work is, however, at a preliminary stage. Ongoing test work is aimed at optimising vanadium recovery and concentrate grade.”

  Syrah Resources Vanadium Scoping Study Results, July 2014

Vanadium demand is expected to grow by CAGR of >5%

A combination of reduced supply resulting from mine closures (particularly Highveld Steel and Vanadium in 2014) and growing demand has seen the vanadium pentoxide price rise sharply to a high of $18.60/lb currently.6 Since September 2016, the vanadium pentoxide price has risen by more than 300%, making it the best-performing mineral in our dataset.

Exhibit 5: Relative price performance of metals and minerals (indexed to September 2016)

Source: Thomson Reuters Datastream

Demand growth is expected to remain strong (>5% per annum7), driven by:

  Mustang maiden vanadium resource announcement, 20 July 2018

new Chinese steel rebar specifications, which come into force in November this year (vanadium’s primary use is in strengthening steel); and

demand for vanadium redox flow batteries, which are rapidly gaining traction as a key technology in the (stationary) energy storage market.

Exhibit 6: Forecast vanadium demand growth

Source: Mustang maiden vanadium resource announcement, 20 July 2018

On the supply side, just 18% of vanadium production comes from primary vanadium mines with the remainder supplied primarily as a by-product in combination with iron from vanadium-titanium-magnetite deposits. As a result, supply growth is determined primarily by demand for magnetite iron ore and may not respond to high vanadium prices. China is the largest producer of vanadium (c 60% of supply) but increasing environmental controls have restricted the ability of Chinese producers to increase supply in response to recent high prices.

Going forward, as demand for high grade V2O5 for use in batteries increases, it is not clear where this new supply will come from as most traditional vanadium supply sources produce ferrovanadium. If metallurgical test results for Caula’s vanadium can echo those of Syrah’s Balama project (located along strike) then Mustang management believes that Caula could have the potential to produce high purity vanadium for the battery market.

Potential value of Caula graphite and vanadium resources

On average, graphite exploration and development companies trade at a multiple of US$9.36 per tonne of in-situ graphite contained in measured and indicated resources while vanadium companies trade at an average of US$205.49/t per tonne of in-situ vanadium in measured resources.8

  Mining Overview: Unlocking the price to NPV discount, November 2017. In the case of graphite we apply a single multiple to measured and indicated resources.

Applying these multiples to Caula’s graphite and vanadium resources respectively gives us a valuation for graphite of US$27.5m (A$37.5m), and for vanadium of US$16.8m (A$22.9m).

Exhibit 7: Caula graphite and vanadium resource value based on peer group multiples

Mt

Grade

Contained graphite/

In-situ

Value

Value

V2O5 (kt)

multiple

(US$m)

(A$m)

Graphite

21.9

0.134

2933

9.36

27.5

37.5

Vanadium

22

0.004

81.6

205.49

16.8

22.9

Total

44.2

60.3

Source: Edison Investment Research. Note: Our analysis is based on a range of potential outcomes and peer group market valuation multiples for contained graphite resources.

The chart below also illustrates a range of potential longer-term value outcomes for the Caula graphite and vanadium project if further drilling continues to increase the size of the resource base. For the purposes of this sensitivity analysis, we have assumed that graphite grade remains 13.4% TGC and vanadium grade remains 0.37% V2O5 (any change above/below this would increase/reduce contained graphite and vanadium and thus potential value accordingly).

Exhibit 8: Sensitivity analysis on potential Caula graphite and vanadium resource value

Source: Edison Investment Research. Note: our analysis is based on a range of potential outcomes and peer group market valuation multiples for contained graphite resources.

Proposed sale of Montepuez to Fura Gems

Mustang Resources is proposing to undertake an asset-for-shares swap with TSX-V listed Fura Gems (Fura). Mustang will contribute its Montepuez Ruby licences into Fura in exchange for shares in Fura in three tranches as follows:

A$3.33m in Fura shares to be issued at a price of C$0.50 on closing (approximately 6.5m shares);

A$3.33m in Fura shares to be issued at a price of C$1.40 after 12 months (approximately 2.3m shares); and

A$3.33m in Fura shares to be issued at a price of C$1.80 after 20 months (approximately 1.8m shares).

Prior to any potential future capital raising by Fura, this would give Mustang around 8% of Fura. The transaction is subject to various conditions precedent (on/before 30 November 2018). In parallel to the transaction, Fura Gems is also purchasing ruby licences in the same district from Regius Resources Group. Fura is proposing a dual listing on the London Stock Exchange this year.

The strategic rationale for a ruby asset combination

Prior to the proposed transaction with Fura, Mustang held interests in ruby mining concessions and exploration licences in Mozambique totalling approximately 192km.2 In late 2016, exploration bulk sampling began, leading to the first sale of rubies in October 2017. Unfortunately, the results of that auction were disappointing,9 and Mustang responded by reducing bulk sampling activities while seeking alternative sales processed to extract maximum value from the asset. As at 10 April 2018, 329,309ct of rubies remained in inventory (which are excluded from the proposed ruby asset sale).

  Company announcement, 1 November 2017

Mustang’s Montepuez ruby project lies in close proximity to Fura’s project of the same name and both are contiguous to Gemfields’ Montepuez mine. Gemfields’ Montepuez is one of the world’s largest ruby deposits with total resources of 467Mct. It was discovered in 2009 and production from bulk sampling began in 2012. To date, Gemfields has sold Montepuez rubies totalling US$407m.10

  Source: Pallinghurst Resources. In June 2017, Pallinghurst Resources acquired Gemfields

Combining Mustang, Fura and Regius, Mozambique’s ruby projects potentially provide:

A unique land position totalling 1,104km2 across the Montepuez ruby belt.

Operational and information synergies across the three exploration programmes.

Marketing benefits from increased scale – customers have stressed the importance of consistency of supply within each size and quality category – as well as the significant coloured gemstone marketing experience brought by the Fura management team.

Fura will be contractually committed to investing A$25m at Montepuez over the next 36 months.

Exhibit 9: Mustang’s Montepuez ruby licences in relation to Fura (and Gemfields)

Source: Fura Gems

Mustang shareholders gain exposure to Coscuez emerald mine

In addition to allowing Mustang’s shareholders to retain an indirect stake in the enlarged Mozambique ruby project, the proposed transaction would also give them exposure to Fura Gem’s Coscuez emerald mine in Columbia. In October 2017, Fura agreed to acquire 76% of Coscuez for a total consideration of US$10m (of which US$2.5m has been paid to date, with the remainder due over three years).

Colombian emeralds account for more than 50% of the emeralds mined globally today, mostly from the Muzo district where Coscuez is located. Emeralds have been produced at Coscuez since at least 1646, but to date modern exploration and mining methods have not been applied to this significant orebody. Mining at Coscuez is an underground mine accessed through a number of small adits. By the end of 2018, Fura aims to:

ramp up production to extract a 30kt bulk sample, processed through a new 50tph wash plant;

collect representative samples from the orebody at different working levels through the bulk sampling programme, to inform mine planning and resource modelling;

conduct 2,500m of diamond drilling to better define the orebody; and

define 43-101 compliant resource and reserves.

In the period to April 2018, Fura had extracted 1.6kct of emeralds from 232t of ore (average grade of 6.9cpt). Within the weeks of first production, the company recovered a high-quality 25.97ct emerald, which they named the Äre Emerald. Fura intends to undertake the first sale of emeralds from Coscuez in Q119.

Exhibit 10: Location of Coscuez emerald mine

Source: Fura Gems

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world-renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisers and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting. Edison is authorised and regulated by the Financial Conduct Authority. Edison Investment Research (NZ) Limited (Edison NZ) is the New Zealand subsidiary of Edison. Edison NZ is registered on the New Zealand Financial Service Providers Register (FSP number 247505) and is registered to provide wholesale and/or generic financial adviser services only. Edison Investment Research Inc (Edison US) is the US subsidiary of Edison and is regulated by the Securities and Exchange Commission. Edison Investment Research Limited (Edison Aus) [46085869] is the Australian subsidiary of Edison. Edison Germany is a branch entity of Edison Investment Research Limited [4794244]. www.edisongroup.com

DISCLAIMER
Copyright 2018 Edison Investment Research Limited. All rights reserved. This report has been commissioned by Mustang Resources and prepared and issued by Edison for publication globally. All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report. Opinions contained in this report represent those of the research department of Edison at the time of publication. The securities described in the Investment Research may not be eligible for sale in all jurisdictions or to certain categories of investors. This research is issued in Australia by Edison Investment Research Pty Ltd (Corporate Authorised Representative (1252501) of Myonlineadvisers Pty Ltd (AFSL: 427484)) and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. The Investment Research is distributed in the United States by Edison US to major US institutional investors only. Edison US is registered as an investment adviser with the Securities and Exchange Commission. Edison US relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. As such, Edison does not offer or provide personalised advice. We publish information about companies in which we believe our readers may be interested and this information reflects our sincere opinions. The information that we provide or that is derived from our website is not intended to be, and should not be construed in any manner whatsoever as, personalised advice. Also, our website and the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. This document is provided for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.
Edison has a restrictive policy relating to personal dealing. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report. Edison or its affiliates may perform services or solicit business from any of the companies mentioned in this report. The value of securities mentioned in this report can fall as well as rise and are subject to large and sudden swings. In addition it may be difficult or not possible to buy, sell or obtain accurate information about the value of securities mentioned in this report. Past performance is not necessarily a guide to future performance. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (ie without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision. To the maximum extent permitted by law, Edison, its affiliates and contractors, and their respective directors, officers and employees will not be liable for any loss or damage arising as a result of reliance being placed on any of the information contained in this report and do not guarantee the returns on investments in the products discussed in this publication. FTSE International Limited (“FTSE”) © FTSE 2018. “FTSE®” is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under license. All rights in the FTSE indices and/or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent.

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Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world-renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisers and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting. Edison is authorised and regulated by the Financial Conduct Authority. Edison Investment Research (NZ) Limited (Edison NZ) is the New Zealand subsidiary of Edison. Edison NZ is registered on the New Zealand Financial Service Providers Register (FSP number 247505) and is registered to provide wholesale and/or generic financial adviser services only. Edison Investment Research Inc (Edison US) is the US subsidiary of Edison and is regulated by the Securities and Exchange Commission. Edison Investment Research Limited (Edison Aus) [46085869] is the Australian subsidiary of Edison. Edison Germany is a branch entity of Edison Investment Research Limited [4794244]. www.edisongroup.com

DISCLAIMER
Copyright 2018 Edison Investment Research Limited. All rights reserved. This report has been commissioned by Mustang Resources and prepared and issued by Edison for publication globally. All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report. Opinions contained in this report represent those of the research department of Edison at the time of publication. The securities described in the Investment Research may not be eligible for sale in all jurisdictions or to certain categories of investors. This research is issued in Australia by Edison Investment Research Pty Ltd (Corporate Authorised Representative (1252501) of Myonlineadvisers Pty Ltd (AFSL: 427484)) and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. The Investment Research is distributed in the United States by Edison US to major US institutional investors only. Edison US is registered as an investment adviser with the Securities and Exchange Commission. Edison US relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. As such, Edison does not offer or provide personalised advice. We publish information about companies in which we believe our readers may be interested and this information reflects our sincere opinions. The information that we provide or that is derived from our website is not intended to be, and should not be construed in any manner whatsoever as, personalised advice. Also, our website and the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. This document is provided for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.
Edison has a restrictive policy relating to personal dealing. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report. Edison or its affiliates may perform services or solicit business from any of the companies mentioned in this report. The value of securities mentioned in this report can fall as well as rise and are subject to large and sudden swings. In addition it may be difficult or not possible to buy, sell or obtain accurate information about the value of securities mentioned in this report. Past performance is not necessarily a guide to future performance. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (ie without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision. To the maximum extent permitted by law, Edison, its affiliates and contractors, and their respective directors, officers and employees will not be liable for any loss or damage arising as a result of reliance being placed on any of the information contained in this report and do not guarantee the returns on investments in the products discussed in this publication. FTSE International Limited (“FTSE”) © FTSE 2018. “FTSE®” is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under license. All rights in the FTSE indices and/or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent.

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Sydney +61 (0)2 8249 8342

Level 4, Office 1205

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Frankfurt +49 (0)69 78 8076 960

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60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

295 Madison Avenue, 18th Floor

10017, New York

US

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

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Research: TMT

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