BlueScope Steel (ASX: BSL) is a global supplier and manufacturer of steel products for the building and construction industries. In January, the company announced that it received a non-binding indicative takeover proposal of $30 per share from a consortium comprising of SGH (ASX: SGH) and US-based Steel Dynamics (NASDAQ: STLD). The BlueScope Steel board rejected the proposal, stating that it materially undervalued the business, particularly considering BlueScope Steel’s $2.8 billion property portfolio. The board subsequently declared a $1.00 per share unfranked special dividend and newly- appointed Chief Executive Officer, Tania Archibald, flagged further cost-out opportunities of an additional $150 million. BlueScope Steel has been a core holding in the WAM Leaders investment portfolio and we continue to see upside not yet reflected in the current share price, underpinned by strong US spreads and an improving outlook for the demand amongst the North American market.
NexGen Energy (ASX: NXG) is a Canadian uranium explorer and developer, with its key asset being the Rook I project in the southwestern Athabasca Basin. Uranium prices rose 25% during the month, supported by an ongoing supply and demand imbalance as well as increasing focus on data centres and the materials required to outfit and expand construction. In January, the company announced a further expansion of the Patterson Corridor East uranium deposit, located 3.5km from the Rook I project, which may provide an extension of high-grade uranium ore and meaningfully extend the mine life at Rook I. We remain positive towards NexGen Energy given the favourable near-term uranium market outlook and a pipeline of catalysts, including the receipt of final federal permits for Rook I, which would enable construction activities ahead of targeted commercial production in 2030.
