Tony Poli must be the luckiest man in iron ore. He may not have felt like it 10 months ago, but he surely does now.

Poli netted about $400 million of the $1.34 billion Baosteel and Aurizon paid for the Perth-based iron ore and coal junior he co-founded – Aquila Resources – just as the iron ore price began to fall off the edge of a cliff.

When the cash bid lobbed to the Aquila board on the first Saturday in May last year, iron ore was trading at about $US110 a tonne. The Aquila board bowed to the deal six weeks later, shortly before iron ore crashed through the $US100 barrier and kept falling – right down to a low of $US47 this month.

No wonder some in the industry have labelled it the "great escape".

But insiders close to the deal have said while it might have seemed a no-brainer for executive chairman Poli and the rest of the board to accept the bid, it was far from it. At the time, the widely held expectation was that iron ore prices were going to rebound, and that $US100 would be a floor.

Poli, who sold his 29 per cent stake in Aquila into the deal, recognises the fortuitous timing but has shied away from discussing the deal because of the difficulty many of his peers in the industry now find themselves in. He declined to comment for this article.

GREAT ESCAPE

But iron ore industry veteran and founding chief executive of Pilbara junior BC Iron, Mike Young, sums up the deal simply: "Aquila was a great escape in any market, at any iron ore price."

Not only did Poli and his team get a good price, they also dodged a major bullet, Young argues.

At the heart of the bid was Aquila's majority stake in the stalled greenfield $7.4 billion West Pilbara iron ore project, which is underpinned by a major new $6 billion port and rail development at Anketell. With the iron ore price stuck now at around $US50 a tonne – a level seen as at, or just above the "new normal" for the sector – the project could well remain in limbo. But Young says he doubted the project was ever going to be viable for Aquila.

"I actually never felt confident that that project would get up in a $US100 [a tonne] iron ore market. I always thought that project was tough. So, that was a double great escape."

"You look at the effort that Gina [Rinehart] has put into Roy Hill and that is a single deposit in a single spot, whereas the Aquila deposits are spread over a long way and logistically it is a tougher ask."

The rail and port also has a huge capital price-tag.

"With all due respect to Tony and the guys, I don't think they could have done that [project] alone."

SECURE SUPPLY

Young says Bao's chief concern was securing their own iron ore supply, noting "they are not interested in the margin in the iron ore, they are interested in the margin on the steel".

The offer represented a 38.8 per cent premium to Aquila's last closing price of $2.45 before the bid was lobbed. While the bid price was a far cry from the glory days of 2010 when Aquila traded closer to $11, it was the highest price the stock had reached since May 2012

Bao, which is China's largest steelmaker, wanted to diversify supply of Pilbara iron ore through developing the project, unlocking a new province of iron ore in the West Pilbara.

Bao owned 19.8 per cent of Aquila before lobbing the bid – after taking a strategic stake in 2009 – and was frustrated (some would say annoyed) at the lack of progress.

Korean steel maker POSCO and AMCI (American Metal & Coal International), each own about 25 per cent of the venture that runs the West Pilbara project, while Aquila held the balance.

Before the takeover offer, both minority partners had refused to invest beyond a minimum in the project and were understood to be sellers at the right price. Baosteel had been sounded out to buy their stakes.

As for Aurizon, it wanted Aquila's "crown jewel" project to break into the tightly held – and highly coveted – port and rail infrastructure in the iron ore heartland of the Pilbara.

OPPORTUNISTIC LOB

When Baosteel and Aurizon lobbed the bid in May, Aquila's directors quickly labelled it "opportunistic". While the Aquila board did not want to scare Bao away, they were hoping to squeeze out a higher price.

Independent experts Grant Samuel said the $3.40 a share bid was reasonable but not fair. Its recommended share valuation range was $3.90 to $5.24.

But some Aquila investors were reluctant sellers into a deal they saw at the time as ridiculously cheap.

One of Aquila's 20 biggest shareholders said at the time; "Chinese companies need to worry about their PR. You can make an offer that's fair; you don't have to steal assets."

The deal was not lacking in drama or suspense. Rich-lister Chris Ellison's Perth mining services firm Mineral Resources blindsided the market when it paid $197 million in an on-market raid for almost 13 per cent of Aquila's register in June, to buy a seat at the table for the West Pilbara project.

When Bao gave MinRes the cold shoulder and declared its initial offer for Aquila "best and final", MinRes lobbed an all-scrip counter offer of $3.75.

LITTLE CHOICE

But the Aquila board was left with little choice but to reject MinRes, even though it would have allowed Poli and the Aquila alumni to stay on board and have a say. Scrip simply didn't stack up against an all-cash offer.

With the benefit of hindsight, of course, Poli and the board's decision to reject MinRes was prudent.

Poli is not one to stand still. He is trying his hand at property, setting up a new Perth-based property development and investment company, Aigle Royal Group.

There is also speculation that some of Poli's cash could find a home in a oil and gas or resources. But the man who beat the iron ore crash is not in any rush.