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    Saturday, January 24, 2009


    Felix Buyout (Change of Control FLX

    The answer to what's going to happen with a buyout of Felix Resources is containted in an interview with Citigroup’s China analyst Huang Yiping.

    "Number one is they certainly don’t want the Chinese companies to go out and invest prematurely. There was a concern last year, for instance, if the Chinese want to go invest overseas whether or not these investors understand the cycles of the market and there was a lot of discussion whether we have the international experiences for making a judgement on the current situation. "

    "What they really want to avoid was making an investment where the asset price dropped significantly the next day. These kind of incidents already caused a lot of political pressure on investors as well as the government and so they're trying to discourage it a bit when people are not sure where is the bottom and so that's I think the first thing. They're probably trying to discourage investing over the near term a bit."

    The Chinese government is going to make Chinese companies wait until there is a confirmed bottom before making any investments. As silly and un-Buffett like as that sounds, I'm sure it's the thinking of BHP etc as well.

    This pretty much guarantees no transaction until FLX is trading above $14 or so for a number of months.

    That's fine, I can wait.
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    Disclaimer and Disclosure Analyses are prepared from sources and data believed to be reliable, but no representation is made as to their accuracy or completeness. I am not paid by covered companies. Strategies or ideas are presented for informational purposes and should not be used as a basis for any financial decisions.
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