It looks like they only got $1,560,750 from the combined financing ($.23 unit, $.25 FT and $.35 FT). This is even lower than the $2M I had hoped for (with my lowered expected view). Clearly, this is bad news. However, they could turn into good news if they are successful with bridge financing (as it would mean substantially less share dilution). It's unfortunate that they didn't mentioned in the NR if they are currently pursuing bridge financing - hopefully they are.
I will post the NR in the comment section of this post.
http://www.newswire.ca/en/releases/archive/May2008/19/c2042.html
27 comments:
Century Closes Flow-Through And Unit Financings
BLAINE, WA, May 19 /CNW/ - Century Mining Corporation (CMM:TSX-V) announces today that, subject to regulatory approval, it has closed a non-brokered private placement of 1,275,000 units at a subscription price of C$0.23 per unit for gross proceeds of C$293,250. Each unit consists of one common share of the Company and one common share purchase warrant, with each warrant entitling the holder to purchase, for a period of 18 months from the date of issuance, one additional common share of the Company at an exercise price of C$0.40 per share. This financing was previously announced on March 27, 2008.
Century also announces that, subject to regulatory approval, it has closed a non-brokered private placement of 3,070,000 flow-through shares at a subscription price of C$0.25 per flow-through share for gross proceeds of C$767,500. This financing was previously announced on March 27, 2008.
In connection with the private placement the Company agreed to pay certain persons for introducing subscribers to the Company a finder's fee of cash equal to 7% of the aggregate gross proceeds of such placement, and share purchase options equal to 7% of the aggregate number of flow-through shares. Each option shall be exercisable at a price of $0.23 for a period of 18 months from the date of issue and shall entitle the holder to acquire one common share of the Company and one warrant exercisable for one common share at a price of $0.40 for a period of 18 months.
In addition, the Company announced that it has closed a non-brokered
private placement of 1,428,571 flow-through shares at $0.35 per flow-through share for gross proceeds of $500,000. This financing was previously announced on December 24, 2007. For introducing certain investors to the Company, Century paid a 6% cash finder's fee. All of the securities issued under these private placements are subject to a four-month hold period.
Production, it is additional evidence that Peggy Kent must be relieved of her Chairman, President and CEO dutes and responsibilities with all due haste. The market has zero confidence in her to lead this company. When will the BOD find the courage and determination to fire her?
How many times can you close a PP?
From Jan 10 NR:
Century also announces that, subject to regulatory approval, it has closed a non-brokered private placement of 3,154,715 flow-through shares at a subscription price of C$0.35 per flow-through share for gross proceeds of C$1,104,150. This financing was previously announced on December 24, 2007.
From March 27 NR:
Century also announces that, subject to regulatory approval, it has closed a non-brokered private placement of 3,154,715 flow-through shares at a subscription price of C$0.35 per flow-through share for gross proceeds of C$1,104,150. This financing was previously announced on December 24, 2007.
May 19 NR:
In addition, the Company announced that it has closed a non-brokered private placement of 1,428,571 flow-through shares at $0.35 per flow-through share for gross proceeds of $500,000. This financing was previously announced on December 24, 2007.
Who would subscribe to 35 cent FT shares after March 27 when the company announces a new PP for 25-cent FT shares?
I could be wrong, but I suspect that today's NR includes the 1,142,571 shares in the March 27 NR and there is only an additional $100,000 today that wasn't registered on March 27.
This is the 4th PP announced since Sept 27 and all 4 PP's have come up well short of the announced goal. This latest effort is the biggest failure of all with only one-third of the intended amount raised.
Natik is absolutely correct; what more evidence does the BOD need? PK may have been able to raise money in the US (Scion), Europe (Wega and Fortis), but there doesn't appear to be any institutions in Canada who will trust her with any money and when your shares trade only in Canada that is not a good situation.
The only bright spot in today's news is much less dilution. If the PP had been fully subscribed and shared equally between common shares with warrants and FT shares, we'd be looking at 30 million new fully-diluted shares instead of 5,620,000.
Hi Carib,
I have some current estimates for both o/s and fd shares. For this exercise, let’s assume that all 1,428,571 shares from the Dec. 24’07 offering are incremental (to simplify the math – we will eventually find out once they post the official o/s share count).
I come up with current o/s count of 168,739,266 shares and current fd count of 187,233,802 shares.
168,739,266 o/s = 162,965,695 balance @ Mar 27’08 + 1,275,000 from $.23 unit + 3,070,000 from $.25 FT + 1,428,571 from $.35 FT
187,233,802 fd = 168,739,266 o/s + 3,370,786 Wega warrants ($1.17 exercise price) + 6,590,000 warrants from Sept’07 financing ($.75 exercise price) + 1,275,000 warrants from current $.23 unit offer ($.40 exercise price) + 6,658,750 options @ Dec 31'07 (on CMM's website) + 600,000 options granted Feb 19’08
For the fd count, there may need to be some further adjustments for small amounts of warrants associated with finder’s fees and such, and perhaps options not exercised (if any).
The good news is that our o/s and fd shares remain at reasonable levels. The bad news (aside from lack of Canadian market support) is that it adds more pressure to be successful with the other short-term financing alternative (bridge loan). Clearly, they have no choice now but to aggressively attempt to find a bridge loan partner. They need to publish a plan tomorrow of how they will attempt to make up the shortfall of the PP.
I agree with both you and Natik, there is now an even greater sense of urgency for top level management changes. The Canadian market appears to have completely given up on this management team, and Century shareholders are paying a massive price, IMO - $.175 sp with a $900 oz gold price and 5M ounces in ground, substantial under subscription on an already discounted PP …..
Century’s BOD needs to publicly address this issue, urgently, IMO.
Production05
So where are the funds going to come from to tide the company over until they can arrange some financing on decent terms ?
The only way out of this sorry mess in the short term may be a hostile take over of the company my another management team with more credibility.
As the SAG mill been removed?
$1.0 million due upon removal of the SAG mill from the site.
Anonymous
"news release after market closes"? Markets not opened in Canada today.
Hi guys,
I wish I had the magic answers to get us out of this mess, but unfortunately I don't. The long suffering shareholders of this company deserve much better than this. I guess the reality is that this is the situation we are in, regardless of how we got here (and how terrible our management has performed). The key is for us to maintain a clear mind as we navigate our way through this mess.
Here are some thoughts on a couple of our challenges:
1) CEO change - I think we should watch Wega closely to clues as to what might be happening behind the scenes. Some of us here believe that Wega's selling was to demand/force a CEO change at Century. It seems like they are willing to sacrific everything to ensure it happens. Also, public BCSC documents (link posted by Relic) seems to support our idea that Wega is currently able to trade at anytime (with the MCTO not affecting them). Wega stopped selling on Apr 16'08 and haven't started back up as yet. This is probably a good hint that Century is still actively looking to make a management change behind the scenes. If this was not the case, and if our theory about Wega is correct, then Wega would have been back selling like mad (trying to force the issue). Instead, they continue to remain quiet - most likely a good sign.
2) Short-term cash - baystock1, the new cash (combined with leftovers from the SAG mill sale) should tie them over for another couple/few months, especially on the working capital side. What's becoming at risk though is the tpd targets in Q3 and Q4, as the missing funds were expected to help them to gain access (more quickly) to the 1.1M in gold reserves. However, all short-term cash issues will be eliminated if they are successful with a bridge loan (I believe they have a good chance of getting one, due to Fortis development). We should know quickly I think (in about 2 or 3 weeks maybe - bridge loan situations tend to move fast, I think anyway). If they are unsuccessful with the bridge loan (and lack other normal funding avenues) then there are probably some emergency type things they can do to raise cash (other than hedging of course). I don't want to get into those right now, as they would involve giving up good (non-core) assets, and I don't think it will get to that stage. I think the association with Fortis gives us a good shot at a bridge loan.
Who are the five visitors who voted that PK should never resign? Shades of Rip Van Winkle! lol
Natik,
I think they were as follows:
Margaret Kent
Peggy Kent
Peggy Witte
Margaret Peggy Witte
Peggy Margaret Kent.
LOL
And Eidgenosse!!
When is the MCTO going to be lifted? Before the Agm?
Question....
I've been involved with CMM since the glory days ($1.50). as have a lot of you. The days when all the excitement was on San Juan's exploration potential and the 80k oz's per year it was going to bring us, and PK was rambling on cc's how undervalued we were. The days when Tom Thompson was wrangling in shareholders with promises of bigger and better things.
Anyway I'm just rambling. (feels kinda good)
One thing that really scares me is the fact that no one has put in an offer to take us out yet. Heck with a 50% premium we could be scooped up for less then 30 cents. With 4.5mm oz of gold in the ground, it seems like a no brainer to me to get those oz's and infrastructur for less then
50mm.
Does anyone have any logic why this hasn't happened yet?
Two words - Peggy Kent!
N/R May 7, "the year-end 2007 financial statements, which the Company expects to file by May 15, 2008."
May22, no Y/E financials.
Its been this way for a long time,anything that this company says can be written in washable crayon.
Then we wonder why the share price is so low?
We also still have the trucks left, if they sell them maybe they need to get them replaced especially for Rosario in the future, but nonethless if we need money it's a better way to go then to dilute more at this level. Very positive also that the majority of the placing conisted of FT shares.
A further note also, hopefully CMM by themselves didn't urge to fully subscribe this PP, after some new info of an possible debt loan, just an wishful thought from me.
If Sulledin would offer 1 share of theirs for 2 of Century I think it would fly. That is what Sue chairman suggested when CMM was trying to take them over. How things have changed.
Nanook,
Like you, I invested in CMM when the share price was $1.50 + (and it was projected to be a potential ten-bagger!!?). As you are wondering (& I am too), if CMM has such fantastic gold assets, why isn't someone taking a run at it at these deeeeep discount prices? PK does not control the company; she is not even the largest shareholder. So, why no hostile takeover effort?
The reasons might be too scary to contemplate (at least for us poor snall shareholders). But I still wonder.
Carib, Producttion, others.. any ideas?
Thanks.
Maybe the time is not at hand as yet. It could be in the works. Who would make such a bid with an MCTO in place for starters? The hostile takeovers in the mining industry are just beginning.
THe $200 million lawsuit filed against us would be a BIG factor.
Bigjohn37, your guess is as good as mine. I don't have the answer, but I do have a couple of thoughts:
1) Everyone is waiting for Lamaque to ramp up and prove itself in today's mining world (to show it can handle today's cost pressures) - potential retail investors waiting on the sidelines, the "market", institutional investors, potential analysts/newsletter writers/tv personalities, TSX, other companies looking to expand through M&A ...... Although u/g mining has been successful on the property for the past 70 years (at gold prices substantially lower), the fact of the matter is that the Lamaque u/g side hasn't been mined since 1985, the Sigma u/g side hasn't been mined since around 1999 ($300 US gold price period), and the area between Lamaque and Sigma (where a lot of gold has been identified) has apparently never been mined ("virgin" area).
2) People generally tend to stay away from anyone (and anything) associated with legal disputes (even if success may eventually bring plentiful rewards). Most company executives are probably no different - they like their acquisitions to be nice and clean (regardless of how discounted the opportunity may be). The whole Shahuindo/Algamarca/Sulliden situation has been a complete disaster for Century - probably a major reason for the share price falling from the $.80 range to $.18. It has resulted in a black cloud completely over the entire company (IMO), and is probably a key reason why Lamaque has been unable to generate any optimism in the share price (even with 4.6M ounces of gold u/g, and solid potential for success). If Century is unable to defer the Algamarca payments into 2009 then it would be very beneficial to reach closure with this entire situation in the near future (one way or the other), otherwise it will continue to be viewed as risks (financial, legal....) to the company. IMO, this is a key reason we are viewed as some sort of plague at this moment in time (even though it might also be a key reason why we have avoided lowball acquisition offers).
Production05
Looks like the Algamarca/Sulliden mess is a savior in disguise if it is indeed one of the factors that could be keeping the sharks at bay.
Delay of the promised financials which when issued will lead to the uplifting of the CTO and possibly other events. Could it be that management is delaying the financials deliberately.
Eventually they'll have to be released and the ish will hit the fan regardless.
Take it for what its worth...
I chat with B.J. today and he said the financials will be released next week...both the Y/E & 1st Qtr..he also said that the company is close to a set up a short-term bridge financing....who knows I will have to hold my breath and wait if this come to pass.
My crystal ball is wacky tonight. Here is what it revealed to me~
-PK's tenure will be over before AGM.
-bridge financing will be approved.
-Fortis debt will be non-convertible and hedging will be lower than expected.
-CMM finally hits some forecasts.
-cash flow positive in the fall (of 2008).
-WEGA and Scion will fall in love with CMM again.
-dilution is over.
-Peru will be in vogue 12 months from now.
-merger
-CMM shareholders wake up from 2 year nightmare and live happily ever after.
I'm taking the damn thing down to the service depot in the morning.
Natik,
I think I saw that crystal ball on E-Bay a couple of years ago. I believe it's been used quite a bit and passed on between a few different owners. Peggy and Ross bought it originally, but sold it to Tom Thompson. Tom tinkered with it for a while then Peggy bought it back and a much lower price. Peggy couldn't get the damn thing to tell the truth so she sold it to Brent. Again at a lower price. Brent seemed to have the same problem and hence your aquisition.
I hope you didn't pay too much for it.
lol.
Have a good weekend everyone. Lets see what Monday brings.
Nice to see some humor amongst the angst, guys and girls! Get Austrian crystal next time. Those balls work better, I hear.
Natik, even if your wacky crystal ball is only half accurate, I'll take its predictions. LOL! The best news in the last two years! Your crystal ball's record can't be any worse than PK's 'official' forcasts.
Maybe, just maybe, our (i.e. shareholders') two-year nightmare is coming to a close.
All I can say is: AMEN!
Nice week-end to all.
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