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Oreninc Index Stays Afloat during Holiday-Shortened Week

The Oreninc Index stayed afloat during the holiday-shortened week ending July 2, 2015. Total dollars increased to $110.4m, a four-week high. Two brokered financings were announced for $30.9m, a two-week high; no bought deal financings were announced for the fourth time in six weeks. 

The main deal-making news of the week included reports of “serious talks” between X2 Resources and Rio Tinto plc (NYSE:RIO) regarding X2’s interest to acquire some of Rio’s Australian coal assets. The deal, said to still be in the early stages, would be worth multiple billions of dollars. Gold was down on the week, reaching the lowest level seen since March. Iron ore and copper were also down for the week.

The strong financing numbers were a welcomed surprise considering the holiday-shortened week.

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Oreninc Index Falls to Nine-Week Low

The Oreninc Index fell to a nine-week low for the week ending June 25, 2015. Total dollars dropped $85.4m, a two-week low. One brokered financing was announced for $1m, a 24-week low; no bought deals were announced for the third time in five weeks.

The largest deal for the week was Glencore Xstrata’s (LON:GLEN) sale of their Cosmos Nickel Complex to Western Areas Ltd (ASX:WSA) for $23.3m. Gold came back down for the week, declining well below $1,200 an ounce. Iron ore recovered and increased marginally.

It appears that the yearly slowdown that the official start of summer brings may finally be upon us. 

 

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Oreninc Index Jumps to Four-Week High

The Oreninc Index jumped to a four-week high for the week ending June 18, 2015. Total dollars announced rose to $99.1m, a two-week high. Five brokered financings were announced for $84.2m, a five-week high; three bought deal financings were announced for $79.2m. 

Deal making for the week was led by Goldcorp’s (TSX:G) decision to sell its 26% stake in Tahoe Resources (TSX:THO) for $99.9m to a group of banks led by GMP Securities L.P. and BMO Capital Markets. The shares will be resold to individual investors. Gold continued its rise, inching just past the $1,200 mark for the first time in over three weeks. Iron ore pulled back for the week for a two-week low. In addition, platinum had an unusually rough week, falling to a six year low.

We’ve officially reached summer and the markets can tell. Although the index was up and there were a couple deals in the space, the positive index numbers are mostly a product of the Kelt Exploration deal, which buoyed the week from what would have been one of the years lowest to a positive week. While the index is usually carried by one or two particularly strong deals, this week was especially stark, as no other deals went above the relatively low $3.2m mark.

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Summary:

  • Number of financings dropped to 21, a nine-week low.
  • Five brokered financings were announced for $84.2m, a five-week high. 
  • Three bought deal financings were announced for $79.2m, a 10-week high..
  • Total dollars rose to $99.1m, a two-week high.
  • Average offer size increased to $4.7m, a five-week high.  

Major Financing Openings:

  • Kelt Exploration Ltd. (TSX:KEL) opened a $78.7 million offering underwritten by a syndicate led by Peters & Co. Ltd. on a bought deal basis. The deal is expected to close on or about July 7, 2015.
  • Coro Mining Corp. (TSX:COP) opened a $3.19 million offering on a strategic deal basis.
  • Northern Graphite Corporation (TSX-V:NGC) opened a $2.5 million offering underwritten by a syndicate led by Secutor Capital Management Corp. on a best efforts basis. Each unit includes a 1/2 warrant that expires in 24 months.
  • Alabama Graphite Corp. (CSE:ALP) opened a $2.5 million offering underwritten by a syndicate led by First Republic Capital Corporation on a best efforts basis. Each unit includes a 1/2 warrant that expires in 36 months.

Major Financing Closings:

  • Newmarket Gold Inc. (TSX-V:NGN) closed a $24.8 million offering underwritten by a syndicate led by GMP Securities LP on a best efforts basis.    
  • Premier Gold Mines Limited (TSX:PG) closed a $20 million offering on a best efforts basis.
  • Yoho Resources Inc. (TSX-V:YO) closed a $5.74 million offering underwritten by a syndicate led by Acumen Capital Finance Partners Ltd. on a bought deal basis.    
  • Manitok Energy Inc. (TSX-V:MEI) closed a $13.8 million offering on a best efforts basis.

 

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Oreninc Index Falls to Two-Week Low

The Oreninc Index fell for the week ending June 11, 2015. Total dollars announced dropped to $25.6m, a two-week low. Seven brokered deals were announced for $25.6m, a three-week high; no bought deals were announced for the second time in three weeks.

Deal making was heavier, with the biggest news coming from Newmont Mining Corp (NYSE:NME) and their purchase of the Cripple Creek & Victor Gold Mine from AngloGold Ashanti Ltd. (NYSE:AU) for US$820m cash, in addition to a cut of future returns from the mine’s underground operations. Iron ore had another fantastic week, almost reaching a five-month high, while gold had another hard week, hitting a 12-week low.

The weak financing market should not come as a surprise now that summer has arrived.

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Oreninc Index Creeps up to Two-Week High

The Oreninc Index crept up to a two-week high for the week ending June 4, 2015. Total dollars exploded to $141m, a three-week high. Three brokered financings were announced for $20m, a two-week high; and two bought deal financings were announced for $5m, also a two-week high. 

The main deal-making news from the week was Premier Gold Mines Limited’s (TSX:PG) completion of their acquisition of 40% of Goldcorp’s (NYSE:GG) South Arturo Mine Project for US$20m and other considerations. Gold had a rough week after positive employment data out of the United States. Iron ore, on the other hand, reached a three-month high in what has been a surprisingly good couple months for the ferrous metal.

While numbers are still not where the industry as a whole would like them to be, both from a financing and commodity price perspective, this spring has given us some hope that there may be some light at the end of the tunnel. That said, it is hard to be too confidant as the warm months approach and activity is bound to, as is has in the past, slow down during July and August.

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