Christopher P. Halloran
Silver Quest Resources and New Gold Inc. today announced a binding agreement whereby New Gold will acquire all of the outstanding common shares of Silver Quest. Silver Quest shareholders will receive 0.09 of a New Gold share for each Silver Quest share held and one common share in a new Yukon-focused precious metals exploration company, McIntyre Minerals Inc., for every three Silver Quest shares held. The offer values Silver Quest at $1.32 per share, representing a 52 per cent premium. Separately, New Gold has agreed to acquire all outstanding common shares of Geo Minerals . Geo shareholders will receive 16 cents per share, and 1/15th of a common share in a new exploration company called SpinCo for each Geo common share held.
Mitec Telecom Inc. may test a year low of 1.5 cents after it reported late Friday a $1.7-million net loss or 1 cent per share during the three months ended July 31, compared with a net loss of $1.3-million during the same months in 2010. Revenues also declined, falling from $2.6-million to $1.6-million, largely the result of reduced sales in Mitec's wireless and two-way satellite ground station divisions. Mitec officials said the company has responded quickly to rising competition for the satellite business, moving into new markets and further cultivating existing ones. That work, they said, has produced a "significant" backlog and should reverse the previous quarter's shortfalls.
Coalspur Mines Ltd. rose as much as 6 per cent early Monday after announcing that testing to determine the potential yield of clean coal from its Vista coal project in Alberta demonstrated substantial improvement from the company's pre-feasibility study, rising to 56 per cent of Vista's likely life of mine. Previous studies pegged the clean-coal yield at 50 per cent of Vista output. Coalspur officials said the results are expected to further enhance Vista's overall project economics, which will be included in the bankable feasibility study, due for publication in early 2012. Coalspur shares were sharply higher earlier today in Australian trading, climbing over 10 per cent in stronger-than-usual volume.
Alacer Gold opened at $10.68 compared to a previous close of $10.85, then touched as high as $10.90 before edging lower again after last night saying it selected a long-time De Beers Group executive as its new chief financial officer, effective Nov. 1. Stuart Brown comes to Alacer after 20 years at the diamond mining, exploration and marketing company, most recently as co-acting chief executive officer in addition to his CFO and executive committee duties since March 2006. Brown also is the second former De Beers official in Alacer's senior ranks, joining CEO Edward Dowling at the firm. Current Alacer CFO Doug Tobler will remain with the company during the transition.
Imvescor Restaurant Group Inc. and Fairfax Financial Holdings Ltd. have finalized a subscription agreement intended to recapitalize the company by repaying convertible debt securities maturing on Dec. 31 and providing additional cash for working capital. The deals, expected to close by Dec. 20, include a private placement of $15-million in stock along with a separate offering of five-year, unsecured debentures yielding 10 per cent interest yearly. Shares will be priced at up to 65 cents and would result in current shareholder position's being diluted by as much as 74 per cent. Both transactions are subject to shareholder, regulatory and senior lender approvals. Imvescor operates pizza and casual dining restaurants throughout Atlantic Canada, Quebec, Ontario and Alberta under various brands.
Facility services company Distinction Group Inc. rose more than 7 per cent early Monday after it announced its results for the third quarter. The company said its revenues went up 12.2 per cent to a record $73.4-million compared to $65.5-million in 2010. Net earnings for 2011 totalled $2.45-million or $0.078 per share, fully diluted, up 3.6 per cent from $2.36-million or $0.077 per share, fully diluted, in 2010.
Cantronic Systems Inc. , which closed Friday near a year low of 11 cents, completed the sale of its majority stake in Shenzhen Huanghe Digital Technology Co. Ltd. of Shenzhen, China, to an unidentified, arms-length buyer. The transaction, first announced last month, was valued at $1.65-million, marking a 43 per cent premium over Cantronic's cost in cash and stock for a 51 per cent interest in the manufacturer of digital cameras and modules. It still owns three other subsidiaries in Beijing and Shenzhen, selling high-speed and digital networked video surveillance systems to government and corporate customers in China. It also retains North American distribution rights for the Shenzhen Huanghe product line for at least two years.
Australian miner Crescent Gold Ltd. , which had been trading near a year low 3.5 cents, late yesterday reported it produced 21,915 ounces of gold from its operations at the Laverton Gold Project in the Eastern Gold Fields during the three months ended Sept 30, matching company projections for the period. Overall, Crescent processed 504,288 tons of ore with an average grade of 1.5 grams per ton over a 39-day campaign at Barrick Granny Smith under its ore purchasing agreement and achieved an average price of $1,660 per ounce of gold, generating net revenue of $36.6 million. The company already has over 300,000 tons stockpiled ahead of a planned 32-day campaign at Barrick Granny Smith during the current quarter, expecting to produce between 17,000 to 19,000 ounces.
SilverCrest Mines Inc. announced that drilling at the La Joya property in Durango Mexico has identified a new "Contact Zone" style of mineralization. The company said hole LJ11-19 is considered the discovery hole of the Contact Zone and intersected 51.4 metres of 102.9 grams per ton silver equivalent.
Orocobre Ltd board chairman James D. Calaway has raised his stake in the lithium and potash producer, last week buying 254,000 shares on the open market for $350,540 - or an average of $1.38 a share. The Oct. 11-14 purchases are Calaway's first since May 2009 when the chief executive of Houston, Texas-based Lithium Investors LLC was the lead investor in a $5-million private placement of stock and rights issue, snapping up 6.8 million shares for $2.6-million and becoming chairman of the board. Orocobre shares are up about 265 per cent over that span and ahead roughly 40 per cent since slipping under $1 earlier this month. Despite that recent rally, however, the stock is off 66 per cent since reaching an all-time high of $4 a share in mid-January.
MidnightTrader.com provides real-time U.S., Canadian and global stock, exchange-traded fund and economic news and trading ideas to both individual and professional investors worldwide.