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On 05/21/20 Caldas Gold $CGC.v announced it is acquiring the Juby Project in the Abtibi Greenstone Belt (Ontario) from $PAAS in what I estimate must be a $c55mm deal. As $GCM.to management is orchestrating this deal, I was intrigued and tried to do some due diligence 1/n
The Juby Project has a 4mm oz resource base: indicated 1.1mm oz @1.28g/t and inferred 2.9mm oz @0.94g/t and has seen multiple owners in the last 15yrs. I was able to reconstruct its history. following players involved: $IMN.v $FM.to $TME.v $OSK.to $LSG.to $THO.to $PAAS $IMR.v 2/n
Temex $TME.v bought the Juby project in July 2002 from Inmet Mining $IMN.v for $250k cash and 100k in shares and calling Juby Project for 'maybe at least half-a-million ounces of gold”. $IMN.v got acquired by First Quantum $FM.to in 2013 3/n
In the next 13years Temex $TME.v continues to drill the Juby project and increases the resource base, but Temex prioritized a 60% JV interest in the Withney Property with Goldcorp $GG $NEM holding the other 40%. It were the dark days for the gold industry in 2013 2014 4/n
June 2015, $TME.v got part in a quadruple arrangement with Oban mining acquiring 4 properties. I believe it was Oban mining that later became the new http://OSK.to (correct me if wrong). But then came Lake Shore Gold $LSG.to which had nearby properties near Whitney 5/n
$LSG.to acquired Temex the next month for a cheap $22mm with main focus on the 60% Whitney JV. In their latest MD&A, $LSG.to wrote:“the Company now owns 100% of the Juby Project, a large project with a near-surface deposit located in the Shining Tree Area of Northern Ontario” 6/n
But this did not last long, $LSG.to was taken over by Tahoe Resources $THO.to in a $945m deal.I guess from there the Juby project must have forgotten, as Tahoe was trying to become a gold producer.The 4mm oz near surface Juby project must have been of secondary interest 7/n
We all know how $THO.to went down, with $PAAS doing an incredible buy at the bottom of the market in 11/2018, with Juby further out of interest only to be acquired by the unlisted South American Resources Corp “SARC” and $CGC.v showing up in the deal. $PAAS not reporting it 8/n
$CGC.v will take over SARC, so CGC will de facto acquire the Juby project + a 25% JV with $PAAS interest in claims around the Juby Project. $CGC is paying SARC 20mm CGC shares and $GCM.to will fund a needed US$10mm cash payment valuing Juby @$c 55m 9/n
$CGC.v has pre-M&A an o/s base of 50.5m shs.With SARC getting 20mm and $GCM.to funding minimal 7mm new shs via PP, I estimate new o/s base of 77.5m for CGC of wich GCM will hold 44.5m or 57% of CGC vs 74% today. @Frank_Giustra and Paesbraga Brian will see their stake lowered 10/n
For $c55mm $CGC.v and $GCM.to are getting a 4mm oz resource basis. They are paying around us$10 per oz in the ground in tier-1 jurisdiction. While a PEA will be far away, my understanding is that Juby remains open for further increasing its resource base. exploration upside 11/n
I would expect further drilling from $CGC.v to map out Hydro Creek, Big Dome and Juby Main zone. Exploration upside left. Further of note is that $IMR.v has a piece of land next to the Juby project and is drilling this. 12/n
Conclusion (1/2): $GCM.to watered down its holding in Caldas $CGC.v to 55-60% after this deal but get tier-1 Canada exposure. CGC holds a strong resource base consisting out Marmato (4.3m oz) and Juby (3.9mm oz) but at current price CGC trades around a c$150mm market cap. 13/n
