KEY POINTS:
CAV
Carpet-maker Cavalier Corp (CAV) has acquired a 70 per cent interest in Norman Ellison Carpets. There appears to be a lot of synergies between the two companies, with Norman Ellison set up initially as a carpet distributor, but growing to become one of the few integrated carpet manufacturers in New Zealand with its own yarn spinning and manufacturing facilities operating on both sides of the Tasman. In its first full year, the company is expected to have a turnover of $60 million and operating profit of $6.5 million. An initial scan through the numbers suggests Cavalier landed a very good deal. Cavalier shares have been but the company is well managed with a long and successful history.
BHP
Shares in BHP Billiton have surged on speculation the company is sitting on one of the world's largest gold resources at its Olympic Dam project in South Australia. BHP has surged along with its rival, Rio, during the past year. As a large diversified mining group, it has benefited from the resources boom driven out of China. It won't last forever but while share investors tend to think in time spans of one year, resource cycles tend to last much longer. Many believe this cycle could go on for years as emerging economies in China and India demand resources to feed their appetite for consumer products and property.
