Chris Ellison’s Mineral Resources awards $140 million to Andrew Ellison’s Resource Development Group

Hi @Bear77 apologies I had missed this response.

Rdg recent half year has come out which would need some further digesting that I'm yet to do. You are correct in your findings. Rdg has had min res as a cornerstone holder for some time. I have held unfortunately as they were falling from grace from previous lofty financials , at one stage they were close to rock bottom until min res injected both funds and the tenements. I believe back then it was closer to rdg holder going to 25% of the new structure and min res close to 75% since diluted.

The free float is extremely low as of the original rdg holder Andrew Ellison and mgmt hold a large portion. Hence liquidity can cause large swings. It is also notoriously slow and quiet in releasing any updates. If anything I expect only statutory reporting during the year. Anything more is a positive as they hardly do any drum beating imho.

Traditionally they were involved in the mining space e.g. contract crushing and their central systems as you see is doing mining and civil works. But recent moves via min res have left me scratching my head and somewhat intrigued about what the game plan is (hence sticking around). They have to keep the lights on done some construction work in Perth for residential , and the recent Onslow work is a sub one year turnaround and I imagine marginal profit albeit a decent revenue boost. But they have commissioned a garnet project. Which according to feaaibilities previously was lucrative and long life. So far we have heard little of the calendar year 2023 ramp up originally slated (sep/Dec quarter it was meant to be up and running originally but it appears it is not at nameplate capacity and I presume isn't hitting strides yet ).

Alongside garnet they have purchased the company doing research into and having run a pilot plant extracting high purity alumina (from memory, I can't quite recall the names). And I believe extracting another battery mineral from clays and left over waste.

Alongside this they have the original manganese tenements which presumably were useless enough to min res to divest them in.

All in all it's a mishmash of projects and work and I can't quite work out if they are targeting an alternative route to the battery minerals market via the niche technology they're developing and supplementing that with the long life cash flows of garnet and their typical constructing and mining work that they've done since inception.

And then there's the manganese assets which look likely to be sitting there for some time.

If anyone else has a take on all of it I'd be glad to hear. It's all quite perplexing but being the Ellison brothers I am somewhat intrigued and holding out trying to work out the overall game plan. If the garnet project hits strides I presume a reasonable steady flow of profit will ensue. Admittedly I have no knowledge of the garnet market or how lucrative it would be so appreciate any comments.

Can't help you with Garnet @SaberX - not something I follow at all, however I have seen similar companies to RDG which I think remains listed on the ASX only because Chris Ellison of MinRes wants to give his brother Andrew something to do. RDG is likely being run more as a family office investment company, and I don't think ordinary retail shareholders are a high priority or are seriously considered during their decision making. You can get lucky and time your entry and exit in such companies so that you do make money, but you can also lose a heap, because they tend to be low quality companies, unlike MinRes which I do hold. Chris divested MIN's manganese assets because he didn't see any immediate or near-term benefit from holding onto them, but he didn't let them drift too far away clearly, as MIN's 64.31% position in RDG means that RDG is technically considered to be a subsidiary of MIN. However MIN's m/cap is $12.5 Billion and RDG's market cap is $100 million, so MinRes (MIN) is 125 x larger than RDG and the 64.31% of RDG than MIN owns represents just over 0.5% (half of one per cent) of MIN's market capitalisation, so virtually immaterial to MIN shareholders, but very material to Andrew Ellison.

I don't know Chris personally, however what I have heard is that he's a hard man to do business with, in terms of being ruthless and always getting the best deal for himself and MinRes, however he is apparently very loyal and reasonably generous to his own employees, mates, family and friends, so it doesn't surprise me that he has used MinRes to support his brother Andrew. While I share an interest in RDG and what they're up to, and where they're going, I'm happy to be following them from the sidelines. I don't want to risk any of my investable capital in a company that doesn't have a clear business strategy and a good track record of positive TSR. MinRes on the other hand does have a very positive track record of Total Shareholder Returns even if their business strategy changes somewhat from time to time.