A possible takeover target

The South African's think they are worth 63 cents/share and they are cashed up, too. No wonder the directors are considering a on market share buyback



MELBOURNE, May 8 AAP - A revitalised Iluka Resources has
indicated it wants to buy a rival mineral sands company,
consolidating its position as one of the world's biggest mineral
sands miner.
The comments from chairman Ian Mackenzie came as the Perth-based
titanium minerals and zircon producer said profits in 2002 were
likely to be in line with last year's operating result of $107.8
million.
Mr Mackenzie said the company would not pursue growth for
growth's sake, but he'd certainly consider being a player in the
consolidating mineral sands sector.
"We're looking at some direct opportunities within our
industry," Mr Mackenzie told reporters after Iluka's annual
meeting.
Asked if Iluka would be interested in tantalum producer Sons of
Gwalia Mr Mackenzie noted that apart from an interest in the Murray
Basin in Victoria's north west, they largely operated outside
Iluka's core operations.
Mr Mackenzie also said Iluka would consider pursuing joint
ventures or alliances to bring onstream its high-grade Murray Basin
resource.
"I think that most of the parties in the Murray Basin are
talking to each other to find ways to efficiently develop the
resource."
Iluka, which has spent more than $11 million exploring its
massive Murray Basin tenements, recently upgraded its heavy
minerals resources estimate in the region to 14 million tonnes,
from 10.9 million tonnes.
Titanium is an ultra-violet absorbing material used in
protective coatings such as house and car paints and sunscreens.
Zircon is used in a range of industrial applications although
its largest use is in the ceramics industry.
Mr Mackenzie said there were signs of a recovery in US titanium
demand with a strong rebound in first quarter demand, particularly
from Iluka's largest customer the US.
"The full-year result should be in line with last year's result
for the continuing operations," he said.
"Because of the timing of product shipments, the first half
profit is likely to be lower than last year, followed by a stronger
second-half profit."
Meanwhile, newly appoint managing director Mike Folwell said one
of his first tasks would be overseeing a review of the company's
operations with an eye to extract at least $25 million from its
$550 million cost base.
Mr Folwell, who previously held the top job at fertiliser group
Pivot, said after just eight days in the job, he likes what he has
seen at Iluka.
"Iluka is a good company with a lot of opportunity in front of
it to grow shareholder value, increase market position and its got
a good balance sheet to use as a springboard to move forward," said
Mr Folwell.
At 1520 AEDT shares in Iluka were trading six cents weaker
$4.47.
AAP