The Gold Report
Notable Quotes
"ICG has closed a CA$2.5M flow-through placement." (12/24/15) Integra Gold Corp. - Thibaut Lepouttre, Caesars Report More >
"The exploration upside at MAG's Juanicipio project is substantial." (12/23/15) MAG Silver Corp. - Gwen Preston, Resource Maven More >
"AKG's management continues to deliver on its development milestones." (12/22/15) Asanko Gold Inc. - Nana Sangmuah, Clarus Securities More >
"We are initiating coverage on KDX with a Buy rating." (12/21/15) Klondex Mines Ltd. - Don Blyth, Paradigm Capital More >
"VIT's Eagle is a shovel-ready, fully permitted, prefinanced gold project." (12/17/15) Victoria Gold Corp. - Tom Hayes, Edison Investment Research More >
First Majestic Adding Ounces Through Acquisition
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RICHARD GRAY, Cormark Securities
(09/15/2009)
Analysis & Forecasts: First Majestic is acquiring Normabec Mining Resources (NMB-TSXV) by issuing 0.060425 FR shares for each Normabec share outstanding, as well as a share in a newly formed public company that will hold Normabec's interests in its gold properties in Quebec. First Majestic will invest $300,000 in the new company (thereby owning about 10%). This deal values Normabec at $0.1806 per share ($0.1406 in FR shares and $0.04 in new company) and implies a 47.7% premium. The proposed arrangement is expected to close in early November and contains a break fee of $350,000. Normabec's primary asset is the Real de Catorce silver project in the San Luis Potosi state in Mexico. Based on the latest resource of 46.8 million oz (33.7 million oz of M&I plus 13.1 million oz of inferred), First Majestic is paying $0.23/oz. Valuation & Recommendation: The acquisition adds cheap, strategic ounces to First Majestic's portfolio and another project that will likely boost its longer-term growth profile. If we value the Real de Catorce ounces at $0.50/oz (FR currently trading at $0.71/oz), this acquisition increases our NAV to $3.40 and our target price to $4.00. We maintain our OUTPERFORM recommendation. Primary Reasons for Recommendation:
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