Sunday, February 27, 2011
Let`s say Century does receive a paper offer from WTG. Let`s say that Peggy and Ross feels the same way as many of us do about WTG`s market cap being grossly overstated relative to its asset profile - potentially sitting on thin ice ready to come apart with any type of slight pressure.
What are they to do about their 25 million Century shares?
Let`s say they want out fast.
They will likely not be able to sell 25 million shares on the open market without taking a serious share price discount, unless they find a private buyer and do a cross.
The dilemma is do they sit around and do nothing (and run the risk by taking, what is viewed by many as being, fraqile WTG shares) or do they go out and try to encourage a competing buyer for Century Mining?
If a competing buyer is reputable enough, and is able to provide a competitive offer price, I think it might be possible for that competing buyer to get a take up of 40 - 50% of Century shares (even if Finskiy and friends still want to keep their own shares). If the offer is good enough, there might even be a chance of getting 51% of Century, with controlling interest and operator rights. As controlling shareholder, the competing company would be able to declare dividends and get 51% of the cash being dividend out (once the company reaches the stage of generating huge profits).
An opportunity of getting a signficant share of an undervalued gold producing company, in a US$1,400 gold price environment, may be enticing to some grown driven companies.
Here is the primary problem: Potential players don`t know the detailed status of Lamaque. Century does not issue (what I would consider) frequent operating updates to the market (be it due to having an agenda or not). And, with any type of hostile bid, the Finskiy controlled BoD, 3 directors versus 2 directors, (I`m sure it`s safe to assume) will not open up the data room for competitors to review the data.
If I was either Peggy or Ross, I would still try to line up a hostile bid in order to protect the 25 million share interest (assuming there is a WTG bid and assuming they are very uncomfortable with it).
I am not them though. As such, I have absolutely no idea how they feel about the situation.
I AM CERTAINLY NOT SAYING THEY HAVE ANYTHING PLANNED.
However, I would like to see them initiative something that would give Century Mining shareholders an option, if the rumour WTG offer happens to occur.
Saturday, February 26, 2011
I have had the fortitude of being in CMM since November 2009 (we were trading at 16 cents at the time), before the investments of Maxim Finskiy and Fran Scola. I have followed the company diligently since then and looking back and thinking about what is going on now this is my interpretation of what has lead us to this point.
When the big financing was done by Finskiy and Scola at 20 cents with warrants at 30 cents in December 2009, they relaunched the company. This company was in dire straights and it was their cash injection that permitted CMM to get Lamaque up and running again. I remember in the first conference call by Peggy, Fran Scola came on and talked for a few minutes. He described how he and Finskiy had searched the planet, looking at over 100 companies and CMM was the one that stood tall against all others for them to build a mid tier gold producers. There was brave talk of gettting CMM to first 300k ounces of gold per year, then 500k ounces. They would get CMM to that level of production by growing both organically and by acquisition. Their SP was to be their currency when doing their M&A activities.
Now fast forward to July 2010: We have a share price that is still hovering around 50 cents because of: delays in start up at Lamaque, the CTO, the CMM history and possibly Peggy Kent and her reputation as well. There was no way to use the CMM SP/MC as a currency to do any M&A activities.
Peggy Kent retires for family reasons in July, yet the SP barely moves. So the PK excuse is now gone. The CTO is also dealt with as every financial report since then has been on time, actually they even followed the TSX guidelines, so that is not the reason for our low share price. However, delays were still ongoing at Lamaque and the reputation of CMM was hurting even more.
What were Finskiy/Scola to do? They have big plans. They are very bullish gold and want to build a mid tier gold producer asap but the CMM vehicle is just not cooperating. Probably sometime in September, there is a meeting of these guys and their advisers to start analysing the situation and come up with a plan to achieve their ambitions.
I believe this plan was to create a new company: White Tiger Gold. This new company would not have the baggage that CMM has. The sharefloat would be much more tightly held preventing a run on the stock and enabling the boys behind it to have a bran new vehicle to go after their ambitions. They still like the assets in CMM, but the history of the company and the shareholder base were complicating their march towards their goal.
With their recent 44-101, they will now be able to raise serious money, probably north of $250M to make a cash deal for CMM shares that they do not already own/control. I would not be surprised to see a PP done at $4 to institutions that will be promised a growth story in the gold space backed by very strong hands. 80M shares would then yield $320M dollars, enough to convince the CMM sharesholders to yield their shares. Max and Fran will simply take new shares in WTG for their CMM shares. You would then have WTG with about 250M shares at $4 for a MC of $1B. With the CMM assets in there, that MC makes more sense then their current MC and current assets. From here, I believe they will get a listing on the LSE and be able to market these assets in a way that was just not possible with the history of CMM.
I believe that the assets of CMM are counted on very hard for the plans of this new company and that we should be paid a fair penny for it. Russians have a reputation of being shrewd and tough negotiators but I wonder how this possible take over will play out. I cannot imagine them giving us their best offer first. A first offer may come in between $0.90 and $1.00 to see how we react.
If we hold our ground and I believe their is enough shareholders big and small who realize the value of CMM at this very important juncture to do this, then we may be able to get them to pay us a more fair value around $1.20-$1.30. I think at this level, they would secure the shares they need to get control of CMM. I know that I would take that offer.
There certainly is reasons to be excited about the next few weeks. Will they announce a bid this week, before PDAC so we can all discuss it at the show or will they wait at the last possible moment, Tuesday March 8th after the market closes?
Exciting times are coming...
PS: I have no insider knowledge and any forward looking statement is pure conjecture on my part.
PPS: These next few weeks may become acromonious were some call out Finskiy and Scola as predators or worse if negotiations get ugle. My view is that if it was not for their injection of money in CMM in the first place, none of us would have made money on this deal. I want to negotiate the best deal possible but I will remain respectful and hope we can all remain so. For those that think the deal is not fair, you may consider buying shares in WTG. I believe there will be good money to be made there. FWR shareholders who took Cliff's paper did very well by doing so.
Wednesday, February 23, 2011
I have an interesting addition.
White Tiger Gold has set up a meeting of their shareholders for the same day - April 12, 2011.
There are many possibilities:
1) CMM and WTG merge, only
2) CMM and WTG gets gobbled up by Polyus at the same time
3) CMM and WTG merge, then the combined company gets acquired by Polyus a few months later
4) The CMM and WTG meetings are unrelated, just coincidence
Here is the WTG SEDAR meeting info:
February 22, 2011Ontario Securities Commission
March 8, 2011
Re: WHITE TIGER GOLD LTD.
We are pleased to advise you of the details of the upcoming meeting of the Security Holders of
WHITE TIGER GOLD LTD.:
Meeting Type: Special Meeting
Meeting Date: April 12, 2011Record Date for Notice: March 8, 2011
Record Date for Voting: March 8, 2011
Beneficial Ownership Determination Date:
Class of Securities Entitled to Receive Notice: COMMON SHARES
Class of Securities Entitled to Vote: COMMON SHARES
Meeting Location: Toronto
We are filing this information in compliance with the Canadian Securities Administrators' National Instrument 54 - 101 regarding Shareholder Communication, and in our capacity as the agent for WHITE TIGER GOLD LTD..
c.c. CDS & Co.
Here is the Century Mining SEDAR Meeting info:
Date: 22/02/2011510 Burrard St, 3rd Floor Vancouver BC, V6C 3B9 www.computershare.com
To: All Canadian Securities Regulatory Authorities
Subject: CENTURY MINING CORPORATIONDear Sirs: We advise of the following with respect to the upcoming Meeting of Security Holders for the subject Issuer:
Meeting Type: Special Meeting
Record Date for Notice of Meeting: 08/03/2011
Record Date for Voting (if applicable): 08/03/2011
Beneficial Ownership Determination Date: 08/03/2011
Meeting Date : 12/04/2011Meeting Location (if available) :
Voting Security Details:
Sincerely, Computershare Trust Company of Canada / Computershare Investor Services Inc. Agent for CENTURY MINING CORPORATION
Saturday, February 19, 2011
- They both don't see much more upside in Century and have decided to reduce their holdings and have found someone willing to buy at current or close to current market prices; or
- They are both exchanging their Century shares for shares in Polyrus to help Polyrus increase the public float in advance of their planned IPO this summer; See Glorieux's post at Agoracom ; or
- They are transferring their shares to a possible acquirer of Century at a price that is much higher than the acquirer intends to offer other shareholders.
I was never much concerned with a takeover offer from anyone, like Agnico-Eagle or one of our other neighbours, because such a bid would never succeed if Scola and Finisky were not interested. However everyone has a price and Scola's and Finisky's price is probably a lot higher than 80 cents or $1.00. They might be convinced to sell for $2 - $3/share though - a nice return on 20-cent shares and 30-cent warrants.
If you lock up a substantial percentage of the Finisky and Scola shares for $2.00 to $3.00/share that is also based on their agreement to sell the balance at the official offer price of say 85 cents to $1.00, then a takeover offer is infinitely more likely to succeed than if everyone, including Scola and Finisky, got an offer of $1.00/share. The Scola/Finisky controlled BOD would likely approve such a takeover bid.
If Century meets their production targets as laid out by Daniel Major on the CC a couple of weeks ago, $1.00 will be seen as extremely cheap for this company later this year. Therefore the time to move is now while there are no significant institutional shareholders and many retailers that bought in at lower prices would jump at an offer of $0.85 to $1.00. As we've seen this week, many are willing to part with their shares for 65 cents or less, so you can imagine how many would accept 85 cents or $1.00.
Tuesday, February 15, 2011
|Broker ID ||Bought||$Val||Ave||Sold||$Val||Ave||Net||$Net|
|7 TD Sec||337,980||213,418||0.631||95,920||60,774||0.634||242,060||-152,644|
|39 Merrill Lynch||30,000||19,150||0.638||0||30,000||-19,150|
|9 BMO Nesbitt||17,500||11,325||0.647||6,400||4,057||0.634||11,100||-7,268|
|80 National Bank||2,500||1,600||0.64||0||2,500||-1,600|
Monday, February 14, 2011
Either something firm is actually brewing behind the scenes or at least a substantial number of investors believe there is something brewing.
Adding fuel to the fire is the mysterious reduction of shares/warrants by Finskiy and Scola over the past week. A further mystery is the use of the word ``Other``, as the transaction tag.
It`s not exactly clear what Finskiy and Scola did with their shares/warrants. I`m not exactly sure what the detailed disclosure rules are either.
If they still own the shares, directly or indirectly (elsewhere, say, in another account) then those shares should still show up in their Century SEDI respective insider account (but they are no longer there).
If they plan of posting a new account on SEDI with those shares then they will likely have about 10 days to do so, from the original transaction date.
It is entirely possible that a reduction is simply that, a reduction, and they no longer have those shares (due to transfer to another party or whatever).
Again, as a result of all the unusual activity highlighted above, it is clear that something extraordinary is taking place.
I don`t think it is all just hype or even sudden overwhelming (not already disclosed) business improvements. I think there is trigger in the centre of all this.
It could all fizzle out as quickly as it started. But, the mystery of the missing insider shares will have to be revealed before the picture becomes fully clear.
I guess we will see what transpires.
Whatever happens, all Century shareholders need to be treated fairly (by fairly, I don`t mean what a so-called independent analyst says is fair - in a back scratching pretend evaluation (we all know how the game works)). If anyone is eyeing the company (for one reason or another) then they need to keep this in mind. In Canada, it takes ownership of 90% of the shares to reach a squeeze out situation. There are a lot of large retail Century shareholders that have stuck around here for a while, through the thick and thin. There are likely more than enough of those shares to block a squeeze situation for a long time (and likely retain a decent size percentage of the company). Folks are not going to be taken advantaged of, if an opportunistic offer comes along.
Everyone invested in a high upside company like Century Mining knows that the gold price is going to the US$1,500 - 2,000 range (or even beyond). Century shareholders haven`t even participated in the gold bull market as yet (over the past 7.5 years since the existence of the company). They are not going to walk away from the farm (at this point, just as the farm is starting produce) without unbelieavable compensation.
Sunday, February 13, 2011
Glad to hear about Hoov having success on the BoD of Galahad. I`m glad for him. I`m familiar with him because I notice him one day chatting about a topic I was interested in. I think he was chatting on agoracom. He mentioned he had written a technical report about the geology in the Beauce-Bellechasse area of southern Quebec. I contacted him to get a copy of that detailed report. He was really nice about it. He sent an online copy to me the next day. Tell him I said hello and wish him the very best with his efforts at this company.
I finally got around to take a quick glance at Galahad Metals, in order to reply to your request about whether it would be a good proximity fit for CMM down the road.
I think it would - once it is more advanced down the road. Actually, Galahad may even have some other options to team up with, in other early stage explo juniors within the outer limits of the Val d`Or region, on the east side - to pool resource ounces together and form a larger company (and potentially reach economical, advanced stages quicker, including scoping, prefeas., final feas., development, etc.). But, that is probably a while longer down the road.
For example, if one company has 400K ounces and another company has 600K ounces then why not pool resources together and graduate to a more advanced stage in faster time while the gold price remains high - only if the economics or the ore bodies support satellite feeds of course.
There are a couple of projects on the east side of Val d`Or that can probably be viewed as pooling potential assets (eventually). One is Simkar (owned by Eloro Resources) and the other is Croinor (JV between Blue Note and First Gold Exploration). There are others coming up also (but at earlier stages currently).
Galahad is likely positioned well for custom milling access also. Alexis Minerals offers custom milling, due to severe shortage of ore from their mine. Eloro will likely use the Alexis mill in a year or two. The Croinor ore might go to the Alexis mill also.
Any of these companies can join up with Century if their ore is pure. I think silver might be ok, but the ore can`t have any base metals (per Peggy in the past).
I (myself) will probably stay away from commenting too much on the Galahad property results. I don`t have sufficient knowledge to do them justice. My skillsets work better with more advanced exploration properties. Nevertheless, a couple of holes from their initial drill program were very interesting (very positive). They certainly appear to have a lot of potential.
Also, I tend to like visuals. I like to see maps and diagrams, coupled with exploration data and style of mineralization, along with tendencies on the specific property and the area in general, and then try to extrapolate possible scenarios.
Tell Hoov to get them to put together some visuals once they have more data and a better handle on the mineralized structures.
It sounds like the type of property that will take a bit of extra time, but could be rewarding when they do the work and put the pieces together. They seem to have started very well.
Glorieux, by the way, I viewed the Smartstox.com interview. I found it to be very informative. I would recommend viewing it for anyone interested in learning more about this company. Here is the link:
Actually, the video has some good diagrams. Galahan should put some of these up on their website. I`m sure they are likely (currently) working on updating their site.
Thursday, February 10, 2011
He gave the impression that he is focused on stabilizing the operation in the here and now, but I also got the impression he has his thinking cap on with regards to how to create future value for shareholders.
This is what a good CEO does. A good CEO is able to multi-task with exception competency (i.e. putting out significant fires while simultaneously pouncing on opportunities to transform the company into something much bigger and better for shareholders).
I heard the CEO - once or twice - (on the conference call) hint that the company plans to increase tpd beyond that 2000 tpd level (likely staggered small steps over time). He didn`t hint of a timeframe - could be a year from now or 2 years or 3 years. It is also not clear as to if he has formulated a plan in his mind as yet as to which locations to pull the increased ore from on the Lamaque property (or whether he is thinking of a possible satellite feed). However, I could tell that he has his thinking cap on and thinking about how to transform the company into something bigger and better in the future.
Wednesday, February 9, 2011
Tuesday, February 8, 2011
Friday, February 4, 2011
I was very impressed with Daniel Major as he comes across as someone who knows what he is talking about and I was pleased that he did not refer any questions to the bumbling Adrian McNutt. He is well informed about the operations after one month full-time on the job although he revealed that he has been on the Lamaque Operating Committee for the past year.
He disclosed that production increased every month in Q4 with production from the Lamaque Flats (LF)only at 480 tpd in Oct, increasing to 730 in Dec and 770 in January. The disclosure of only 480 tpd in October with little contribution presumably from Bedard Dyke (BD) really brings into question how McNutt could forecast production of 10,000 to 12,000 ozs in Q4.
December production was 1100 tpd consisting of 730 from LF and 370 from BD.
Although the stated January production from LF was 770, DM said the ultimate target is 1,000 tpd from LF and "we are very close to that as we speak". The balance will come from BD and the North Wall where there is higher grade ore. They are already finding higher grades from the second level of the BD.
Production from BD has been constrained to date because they could only process development ore while there was only one access route to the area. As of yesterday a raise has been established which becomes the second access route which will allow stope mining in addition to processing development ore. The North Wall will have the same requirement.
The forecast tonnage for 2011 is:
1200 tpd for Jan & Feb
1500 tpd for Mar & Apr
2,000 tpd for May - Dec.
At an average grade of 3.75 g/t, this translates into about 74,000 oz which is within the forecast of 70,000 - 75,000 oz.
Upgrades on the mill are scheduled for April which will increase the capacity from 1500 tpd to 2000 tpd. At that time production from North Wall will be added to make the jump from 1500 tpd to 2000 tpd.
I really liked the no hesitation responses to all of the questions. This guy comes across are very competent who knows what the issues are and how to achieve results.
To all of the long suffering shareholders I would say to remain patient for a little while longer as there is light at the end of the tunnel.
Thursday, February 3, 2011
What was telling by the price action today is that the market expects Century to miss its forecasts as they have done nothing but over-promise and under-deliver for years. They always have excuses, but the common denominator is Adrian McNutt, now that Peggy has gone and Hulley has retired. It is also an indicator of just how undervalued the company is – based on its assets; otherwise if it were trading anywhere near fair value, it would have been punished for this latest miss.
How bad was the latest miss? Well on November 15 which was already half way through Q4, the company lowered its guidance for Lamaque to 18,000 to 20,000 for 2010. Considering that the total production to the end of Q3 was 8,401 ozs, Q4 production needed to produce 10,000 oz to be near the low end of the range. What we got was 6,018 oz – a miss of some 40%. How can you miss by 40% when your forecast only has 6 weeks to go?
When someone asked Hulley on the CC why should investors believe the new revised forecasts, he seemed almost offended by the question and assured listeners that Century had a high degree of confidence in meeting its lowered guidance. I don’t blame Hulley – he has to rely on his operations manager Mr. McNutt.
2011 guidance for Lamaque has been lowered from 80k to 90k ounces to 70k to 75k ounces for a total, including San Juan, of 90k to 100k ozs. The key going forward will be the degree of confidence the market has in the new CEO, Daniel Major. I’ll be listening with interest to what he has to say tomorrow and how much he defers to McNutt?
The company really needs to break its 2011 forecast down to quarterly forecasts and meet or beat each of those quarterly forecasts. This time last year the 2010 forecast for Lamaque was 40,000 to 45,000 ozs. Actual production of 14,419 demonstrated a huge over-promise and under-deliver.
As I said in a message a few days back; the news is neither good nor bad. The news is essentially neutral at this point....missing the target by a few K is not a huge issue when you’re just getting going. Also, the target for next year is still on and progress has defiantly been made and will continue to be made.
At this point it is a waiting game as Century is just taking off the runway and is working towards a CF+ state which should be achieved in the near future.
We can also expect (IMO) some consolidation at the .49-.59 levels for the time being which simply means we will probably have a tight trading range as we go forward over the next few weeks and maybe months as Century get’s things spinning.
Overall, I can’t say the news was bad nor good but I can say that it was extremely encouraging. We have a great management team in place and we are confident that they will get up into commercial production in a not so far away time period.
As a shareholder I am extremely happy with what Century has done over the past 18 months and I look forward to the next 18J
I hope this takes care of the 28msg’s I had in my inbox this am in regards to the news:):)