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Oreninc Index Stumbles into Fall

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Oreninc Index Stumbles into Fall

 

 

 

 

 

The Oreninc Index stumbled for the week ending October 10, 2014. Total dollars announced dropped to $59.9m, a four-week low. Three brokered deals were announced for $42m, a three-week low. No bought deals were announced for the second time in four weeks. It seems that things are only getting worse in the financing market.

 

 

 

Deal making was active this week, with Lundin Mining (TSX:LUN) buying Freeport McMoRan’s (NYSE:FCX) 80% ownership interest in the Chilean Candelaria/Ojos del Salado mining operations for $1.8b in cash. Rumours also swirled of Glencore PLC (LON:GLEN) trying to merge with Rio Tinto Group (NYSE:RIO), though it appears Rio has rejected the reported all-stock offer made by Glencore. The deal would create the world’s largest publicly traded mining company.

 

While fundraising and equity numbers are increasingly getting worse and worse, the crazed deal making from this week is an interesting development. Maybe with companies out trying to make things happen, excitement will be spurred and investors will find value in what has been created. Nonetheless, it would not be wise to hold your breath in a market that has never looked worse during a time of the year that it generally looks its best.

 

 

 

 

Summary:

 

  • Deals announced fell to 16, a 39-week low.
  • Three brokered deals were announced for $42m, a three-week low.
  • No bought deals were announced for the second time in four weeks.
  • Total dollars dropped to $59.9m, a four-week low.
  • Average deals slipped to $3.7m, a three-week low.

 

 

Major Financing Openings:

 

  • Mountainview Energy Ltd. (TSX-V:MVW) opened a $25 million offering underwritten by a syndicate (yet to be disclosed) on a best efforts basis. Each unit includes a 1/2 warrant that expires in 24 months.
  • Strata-X Energy Ltd. (TSX-V:SXE) opened a $12 million offering underwritten by a syndicate led by Integral Wealth Securities on a best efforts basis. The deal is expected to close on or about November 3, 2014.
  • Duluth Metals Limited (TSX:DM) opened a $5 million offering underwritten by a syndicate led by Industrial Alliance Securities Inc. on a best efforts basis. The deal is expected to close on or about October 21, 2014.
  • Goldrock Mines Corp. (TSX-V:GRM) opened a $5 million offering on a best efforts basis.    

 

 

Major Financing Closings:

 

  • Largo Resources Ltd. (TSX-V:LGO) closed a $30 million offering on a best efforts basis.  Each unit includes 1 warrant that expires in 36 months.
  • EMED Mining Public Ltd. (TSX-V:EMD) closed a $23.91 million offering on a strategic deal basis.    
  • Peregrine Diamonds Ltd. (TSX:PGD) closed a $15.1 million offering on a best efforts basis. Each unit includes 1 warrant that expires in 6 months.
  • Jericho Oil Corp. (TSX-V:JCO) closed a $4.23 million offering on a best efforts basis.

     

 

Oreninc also publishes the Oreninc Deal Log, a daily list of all financing activity in the TSX, TSX-V and CSE resource sectors. Visit http://oreninc.com to see which companies and sectors to watch. Oreninc also writes custom reports for companies on effective capital raising strategies to help companies maintain long-term shareholder value.

 

Posted October 15, 2014

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