TCN Media & Investor Newsletter | BKW, FBR and MTM

The proposed merger between Soul Patts (ASX: SOL) and Brickworks (ASX: BKW) made the headlines this week in a deal which is set to create a $14 billion investment powerhouse.

The marriage of these two ASX stalwarts will end decades of a tangled cross-shareholding relationship which currently sees Soul Patts own 43 per cent of Brickworks, and Brickworks holding a 26 per cent stake in Soul Patts.

Upon conclusion of the deal, Soul Patts shareholders will control about 72 per cent of the newly merged entity which will trade on the ASX as Washington H. Soul Pattinson, under the ticker code ‘SOL’. Brickworks shareholders will hold 19 per cent of the company, with the remaining 9 per cent allocated to investors.

The new entity will own investments across a range of privately owned companies, publicly listed business, private credit, as well as more than $3 billion in real estate partly due to Brickworks’ portfolio of land.

With a history stretching back to 1872, Soul Patts is one of Australia's most renowned investment firms holding a diversified portfolio of assets across multiple industries. It is also the nation’s second oldest publicly listed entity having first traded on the Sydney Stock Exchange in 1903.

“Merging Soul Patts with Brickworks makes a lot of strategic and financial sense. It simplifies the structure, adds scale, and creates a more investable company.” – Todd Barlow, Soul Patts CEO and Managing Director

Meanwhile, Brickworks has grown to become one of the world’s largest building material manufacturers since its inception in 1934.

In Australia, it boasts established operations through well-known brands such as Austral Bricks and Bowral Bricks. It also has a strong presence in the US market with its North American division operating across 28 locations.

In addition, Brickworks leverages surplus operational land by repurposing it for property development. This enables the group to build a portfolio of property assets as part of its operations.

“The time is now right to combine with Soul Patts, bring our portfolios under one investment company, and become a well-resourced and more diversified group delivering long term value for our shareholders.” - Mark Ellenor, Brickworks CEO

FBR Limited (ASX: FBR)

Speaking of bricks, FBR Limited (ASX: FBR) recently completed a 10-house demonstration program in Florida, United States, using its Hadrian X robotic bricklaying technology. The demonstration program was an operational success for FBR, demonstrating it is possible to build the walls of a standard home in a single day using the Hadrian X. The appearance of a bricklaying robot in Florida generated a huge amount of excitement amongst the public and industry participants and was a significant step in the company’s commercialisation push.Hadrian X autonomously constructs structural walls based on 3D computer-aided design models. Utilising the company’s proprietary Dynamic Stabilisation Technology (DST), it can operate with precision in outdoor environments by compensating for variables such as wind and vibration.FBR has completed 32 structures in Western Australia using the Hadrian X (24 double storey residential, six single storey residential and two commercial) and another 10 single storey homes in Florida, United States.

The R&D phase of the Hadrian X technology is now complete, with the product entering the commercialisation phase. The company is building a pipeline of work both in Australia and in international markets including the United States, and is scheduled to bring its next Hadrian X unit online early in the new financial year.

FBR is now exploring adjacent opportunities to leverage the existing IP suite it has developed through the Hadrian X R&D program. Earlier this year, FBR completed a successful demonstration of its technology to one of the largest shipbuilders in the world, Samsung Heavy Industries. FBR and Samsung Heavy Industries are continuing to explore opportunities for the implementation of DST-enabled products in the shipbuilding industry. Shipbuilding is just one of the adjacent opportunities for FBR’s Dynamic Stabilisation Technology and its stabilised long boom delivery systems, with the company exploring other industries including the steel industry.

“FBR is a world leader in developing large scale robotic solutions for large scale tasks. We are now offering this capability to customers to introduce the efficiency of automation to their businesses.” – Mark Pivac, FBR Limited CEO

MTM Critical Metals (ASX: MTM)

MTM Critical Metals (ASX: MTM) also notched up a notable outcome in the week gone by, with the company’s proprietary Flash Joule Heating (FJH) technology successfully recovering antimony (Sb) from US-sourced electronic waste.

More specifically, the group recovered 98 per cent of antimony at a grade of 3.13 per cent Sb from printed circuit board feedstock. This outcome substantially exceeds the grade of typical ore from mining operations, where even the largest deposits average between 0.5 per cent and 0.7 per cent Sb.

Management believes that these results showcase the technical and strategic value of the company’s FJH process in recovering critical metals from e-waste, directly supporting US efforts to re-establish domestic refining capacity of antimony.

Antimony is traditionally used in flame-retardant materials and a host of other products such as lead storage batteries, munitions, and ceramics. However, it is also utilised in several modern-day technologies - including solar panels - to help enhance efficiency.

In recent times, China's tightening control over strategic metal exports, such as antimony, has fuelled significant supply-side uncertainty in global markets. In turn, the price of antimony trioxide has more than tripled since 2023.

According to MTM, China accounts for nearly 50 per cent of global antimony mine production and controls more than 70 per cent of global antimony refining capacity. As such, the group’s technology could help support US efforts to secure domestic antimony supply and reduced dependence on imports, particularly from China.

Notably, the company has already locked in more than 1,100 tonnes per year of e-waste feedstock under long-term agreements with US suppliers, which lays the foundation for the potential commercial deployment of its FJH technology.

“This result demonstrates the strong technical and commercial potential of our FJH process for recovering strategic metals from e-waste. Achieving 98% recovery of antimony at over 3% grade, from domestic urban feedstock, is particularly significant given the U.S. currently has no meaningful domestic Sb production.” – Michael Walshe, MTM Critical Metals Managing Director & CEO