RCKS Talk

16-May-2018

Maritime Resources Corp.

Maritime Adds Land; Doesn’t Alter Our View

Impact: Neutral

Maritime Resources has announced the acquisition of 3,225 ha of claims surrounding its Hammerdown asset (Figure 1).

  • Strategic land consolidation may provide incremental fundamental value; potential justifying a change to the current offer of 0.390 of a common share of Anaconda in exchange for each Maritime share
  • Share component of the acquisition (500k on signing, plus an additional 1.5 million shares through the life of the deal) could be considered an additionally dilutive tactic, similar to the previous C$1M financing as a takeover defense tactic against Anaconda
While we expect Anaconda to be displeased with the expanding share count, it’s likely a transaction it would have eventually undertaken. Therefore, we do not expect them to pull the offer and we continue to believe that the a hostile takeover proposed by Anaconda in April still has an 60-70% chance of being completed.

 

13-May-2018

RCKS Charts

Three Names with Positive Momentum

In this edition of RCKS Charts, Keith has evaluated Anaconda Mining Inc (TSX:ANX), Sierra Metals Inc. (TSX:SMT) and Ascot Resources Ltd (TSXV:AOT).

07-May-2018

Anaconda Mining Inc.

Anaconda’s Response As Expected

Impact: Neutral

Anaconda has responded to statements made by Maritime in response to Anaconda’s hostile offer to acquire all the outstanding common shares of Maritime. 

  • Response is as expected and normal course, as a result this does not change our view with respect to the likelihood of the acquisition being completed (60-70%)
  • We continue to believe the current offer for 0.39 an Anaconda share for each Maritime share which represents an 26% premium based on today's (implied value C$0.14 per Maritime share) is accretive for both companies’ shareholders
  • We expect Maritime shareholders are likely to eventually support the acquisition for the significant purchase price premium and to avoid Maritime’s share price retreating to pre-offer levels
Assuming the transaction is completed, Anaconda continues to trade at discount to peers (0.32x NAV, peers 0.64x); ongoing exploration success and the completion of the Maritime acquisition should close the gap to peers.

03-May-2018

​Anaconda Mining Inc

Anaconda Releases Q1 2018 Financials

Impact: Positive

Anaconda releases financial results for Q1 2018 with higher than expected revenue and lower operating cash costs.

  • Better grades, lead to higher production and lower than expected cash costs at Point Rousse
  • Development spending at Goldboro and Point Rousse, higher than expected
  • Anaconda continues to trade at a discount to peers
Anaconda continues to trade at discount to peers (0.30x NAV, peers 0.64x); ongoing exploration success and the completion of the Maritime acquisition should close the gap to peers.

19-Apr-2018

Anaconda Mining Inc.

Thicker High-Grade Intercepts from Goldboro

Impact: Positive

Anaconda intersected thick higher-grade zone near newly identified fault structure, expanding the gold mineralization down-dip of the existing resource.  

  • Gold mineralization extended down dip with high-grade assays
  • Impressive widths and grades as drilling intersects a new fault structure
  • Results point to resource growth – 10% increase in both grade and tonnes at Goldboro increases our NAVPS estimate by 9%
  • Drilling at Maritime’s Hammerdown intersects near-surface high-grade gold 
After recently incorporating Anaconda’s potential acquisition of Maritime Resources (TSXV: MAE), our NAVPS estimate increased to C$1.12/sh results in Anaconda trading at a steep discount to peers (0.33x NAV, peers 0.65x).

16-Apr-2018

Anaconda Mining Inc.

Anaconda Launches Takeover Bid for Maritime

Impact: Positive

Anaconda has formalized its offer to acquire Maritime Resources Corp. (TSXV:MAE) causing us to incorporate Maritime’s Hammerdown mine in our estimates.

  • Sweetened Maritime takeover bid increases odds of completion
  • Initial production from Hammerdown expected in late 2019
  • Estimates indicate the transaction is accretive to both Anaconda and Maritime shareholders
Incorporating Hammerdown, increases our NAVPS estimate to C$1.12/sh (was C$0.97/sh) for Anaconda should the transaction be completed as defined, resulting in Anaconda trading at an increased discount to peers (0.35x NAV, peers 0.65x).

13-Apr-2018

Anaconda Mining Inc.

Q1 Production Ahead of Estimates on Better Grades

Impact: Positive

Gold production of 4,293 ounces at Point Rousse ahead of our estimate for 3,439 ounces.

  • Production beats our estimates on better than expected grades
  • Operational execution, should help fund development and exploration activities
  • Strong quarter has Anaconda positioned to beat 2018 guidance

Anaconda continues to trade at discount to peers (0.40x NAV, peers 0.64x); ongoing exploration success should close the gap.

 

05-Apr-2018

Anaconda Mining Inc.

Goldboro Expands to the East

Impact: Mildly Positive

Infill and expansion drilling continues to be encouraging at Goldboro, highlighting the ability to expand resources at the deposit.

  • Drilling expands Goldboro east with similar tenure of mineralization seen across the deposit
  • If Goldboro's mineable resource increases by 10% increase pre-tax NAV for the project by 9% our overall NAVPS by 2%
  • Drill success at both Point Rousse and Goldboro highlight the potential for organic growth, while the company continues to work-on growing via acquisition
 
Anaconda continues to trade at discount to peers (0.39x NAV, peers 0.63x); ongoing exploration success should close the gap.

23-Mar-2018

Anaconda Mining Inc.

Argyle Continues to Grow at Potential Higher Grades

Impact: Positive

Download Report

Infill and expansion drilling at Argyle point towards resource expansion and the potential for increased grade.

  • Drilling expands Argyle, discovers new high-grade zone.
  • Even an incremental 25% increase in Argyle’s resource grade adds value
  • Maritime has responded to Anaconda’s intention to bid; we still consider the likelihood of a merger to be 50%. 
Anaconda continues to trade at discount to peers (0.42x NAV, peers 0.65x); ongoing exploration success should close the gap.

 

01-Jan-2018

Anaconda Mining Inc. (TSX:ANX)

RCKS Talk Blog Archive

We updated the look & feel of our RCKS Talk Research Blog in March 2018.

To access the historical archives of our original blog format, please click on the link(s) below to be re-directed. Please note that we no longer update those archive blog pages.

Click here to access the RCKS Talk Blog Archive for Anaconda Mining Inc. (TSX:ANX)


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