Today's Australian Financial Review is reporting that gold and nickel miner Sirius Resources N.L. (ASX: SIR) is a takeover target for mining rival Independence Group NL (ASX: IGO).
According to the sleuths at the paper's Street Talk column Independence Group is cashed up and looking to acquire WA-based Sirius, which has a number of prospective nickel and gold interests across WA.
Sirius is currently valued at more than $1 billion by the market, so Independence Group would likely to have offer a lot of scrip to Sirius or investors in order to fund an acquisition that would probably command a premium price.
Sirius stock has jumped 5.12% today to $3.08 as investors react to today's reports that a potential offer for the nickel miner may be on the horizon. Sirius's Nova Nickel mine is still in the construction and development stage, but is reputed to have mineral wealth to rival the mythical King Solomon's Mines and this is what is probably attracting investor interest.
Independence Group closed slightly lower at $5.99 today, although it has gained around 43% over the past year.
These two businesses have their merits as speculative buys, but why buy a mining stock in the hope of a takeover offer when you could buy a gangbusters growth stock on an attractive valuation?
