Syrah Resources Ltd (ASX: SYR)

SYR Details

Successful completion of institutional placement: Syrah Resources plunged 7.6% on September 21, 2017 while the group resumed trading on an “ex-entitlement” basis and announced about successful completion of its institutional placement and the institutional component of its 1 for 10.5 pro rata accelerated non-renounceable entitlement offer. The group has been able to raise A$74 million through placement and institutional entitlement offer. The group stated that the placement was oversubscribed and the institutional entitlement offer received a high level of support with a take up rate of approximately 91%. However, SYR was unable to meet the target of $110 million underwritten capital raising as indicated earlier. The group will open its retail entitlement offer on Monday 25, September 2017 and the same will close on Thursday, 5 October 2017. Eligible retail shareholders will be invited to participate in the retail component of the 1 for 10.5 pro rata accelerated non-renounceable entitlement offer under which new shares will be offered at A$3.38 per share (same as the Institutional Entitlement Offer). This move was undertaken to support the ramp up of Balama graphite project and Battery Anode Material (BAM) strategy; and was found to be the preferred way to raise capital instead of debt funding that emerged expensive for the group. We believe it might be better to wait and watch out for some positives emanating from the projects, and maintain a “Hold” recommendation at the current price of $ 3.51

Tatts Group Ltd (ASX: TTS)

TTS Details

Federal Court remits the merger matter back to the Australian Competition Tribunal: Tatts Group’s stock shed about 1.35% on September 21, 2017 as the group announced that the Full Federal Court of Australia has upheld the judicial review application made by the Australian Competition and Consumer Commission (ACCC); and remitted the matter back to the Australian Competition Tribunal for further consideration and made orders setting aside the authorisation granted by the Tribunal for the combination of the Company and Tabcorp Holdings (Tabcorp). The court thus found the matter in favour of ACCC's claim that the Australian Competition Tribunal had made reviewable errors in allowing the merger to proceed. The Federal Court has been said to have made no orders in relation to the judicial review application made by CrownBet. The reasons for handing the matter back to the Tribunal will be specified in due course. Both Tabcorp and Tatts were in a trading halt on September 20, 2017 ahead of the Federal Court’s decision. Despite this blow from the Federal Court, the groups intend to be moving in line with their planned merger’s timelines. We maintain an “Expensive” recommendation on the stock at the current price of $ 4.02

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