Since Keith Neumeyer was on the show recently I thought I'd bring this up and ask a question -
First Mining Finance, the company he and others have formed seems to be on a buying spree these days and just announce that they would be acquiring Gold Canyon Resources and PC Gold with an all stock deal. It seems to have escaped most folks notice since it was announced while the market was doing another one of its big dumps. The only way I found out about it was that suddenly my Gold Canyon stock jumped about 25% and got me wondering why. This is from the news release:
Under the Agreements, shareholders of Gold Canyon will receive one common share of First Mining for each Gold Canyon share held in addition to shares in a newly formed Spin-out company ("New Gold Canyon") which will hold certain non-gold exploration assets currently held by Gold Canyon; and PC Gold shareholders will receive 0.2571 common shares of First Mining for each PC Gold share. Upon completion of the proposed transactions, the former shareholders of Gold Canyon will hold approximately 55.4% of the shares of the resulting company, former shareholders of PC Gold will hold approximately 9.6% of the shares of the resulting company and the current shareholders of First Mining will hold approximately 35.0% of the shares of the resulting company.
From what I read the deal says that a share of Gold Canyon is essentially the same as a share of First Mining and at some future date all my Gold Canon stock will, on a 1 for 1 basis, get re-issued as stock of First Mining Finance. That is fine with me since they already own another small gold miner, Coastal Goal and several other properties. I just wanted to check to be sure that I was correct on this.
Also, I'm curious what other folks think of the whole premise behind First Mining Finance. I really want to invest in a miner that treats the assets in the ground with some level of respect and has the financial ability to step back and cut production when prices are stupidly low. The fact that most miners have had to start mining their highest quality assets to stay alive drives me nuts. Shouldn't they be shutting down production till pricing improves?
Mike in Albuquerque