Daily Brief Australia: Rio Tinto Ltd, Avjennings Ltd, Iron Ore and more

In today’s briefing:

Digging Deeper: The Vote Failed, But the Value in Rio Tinto’s Dual Listing Remains Untapped
AVJennings (AVJ AU) : 11th July Vote On AVID’s Offer
Iron Ore Tracker (12-May-2025): Looking for Green Shoots In Iron Ore

Digging Deeper: The Vote Failed, But the Value in Rio Tinto’s Dual Listing Remains Untapped

The shareholder vote failed, but momentum builds: Despite only 19.35% support, institutional backing signals growing pressure on Rio Tinto’s board to revisit the dual-listed company structure in future.
Valuation gap widens, thesis strengthens: With RIO Ltd trading at a 23.2% premium over RIO plc, the economic case for unification — and the relative value trade — becomes increasingly compelling.
Not statistical arbitrage, but event-driven optionality: The long plc / short Ltd setup lacks persistent mean reversion but offers asymmetric upside if governance shifts, tax changes, or structural catalysts force convergence.

On the 1st April, Avjennings Ltd (AVJ AU), a widely recognised home builder in Australia/New Zealand, entered into a Scheme Implementation Deed with AVID at A$0.655/share.
A special dividend – included in the Scheme consideration – could add A$0.072/share in franking credits (to those shareholders who can take advantage), or ~11% of the consideration. That’s chunky.
The Scheme Booklet is now out, with a Scheme Meeting on the 11th July, and expected payment on or before the 14th August. The IE (Kroll) says “fair & reasonable“.

Iron ore prices remain around $97/ton, down 0.5% WoW, staying within a long-term range of $95-$130/ton over the past four years, indicating sustained price stability at the lower end.
With weather conditions improving in Australia, we expect iron ore shipments to start increasing and China to import more than 100 million tons/month.
We like Fenix Resources (FEX AU). The company recently presented at the RIU Resources Round-up Conference in Sydney on 7 May 2025.

💡 Before it’s here, it’s on Smartkarma

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network