What can we expect tomorrow?
Sandstorm published their numbers and with an 8% stream agreement we can expect around 17k ounces from Black Fox for the last time.
WPM got around 1 Million ounces of silver from San Dimas, so we expect around 17k ounces AuEq from san Dimas as well.
McEwen said in their Q3 discussion: They were interested in San Dimas as well, but they first had to digest Black Fox!
WPM said in their Q3 discussion:
Kevin Fu
First off just want to say thank you for the additional detail breakout of the other categories for production and sales quite helpful. Just a few questions from me, on San Dimas with Primero’s credit facility coming due in a couple weeks. Any thoughts as we approach to that deadline?
Randy Smallwood
Yes, I mean its Randy here Kevin it’s, we’re supportive in terms of working with Primero. We’ve been pretty clear about the fact that as long as progress is being made towards a solution here that we would extend that guarantee, and so we’re hopeful that Primero keeps making progress.
Anita Soni
And then, secondly in terms of have ever had your actual title on the royalty or the stream tested in bankruptcy court?
Randy Smallwood
We have in the past we’ve got a very strong security position on San Dimas. So this is a little bit different every, every partnership is different. You know, our hopes are that, we do see there is a solution here and we’re just waiting for Primero to act on that solution that would have avoid any of this kind of process, but that is up to Primero. But our security being, second rank behind the debt and the fact that we’ve guaranteed that top level debt puts us in a very, very good position with respect to this asset, hope we never have to use though.
Anita Soni
And so at this stage - I mean would we expect another extension or is that’s the 23rd is the deadline?
Randy Smallwood
Well the 23rd is the deadline, we’ve always been very clear that – in fact that's why we provided the guarantee in the first place. We’ve been very clear about being supportive to Primero as they worked their way through this process. What I can tell you is that the asset does have healthy interest, and so there is lots of – there is opportunities here and now it is up to Primero to choose their own path. We’re willing to work with them and we have been working with them and we’ll continue to work with them to hopefully get them, to take one of these paths, but they have one their choices so.
So my conclusion is that Primero still has several opportunities to solve their problems! Their biggest burden and mistake was Black Fox. They lost hundreds of millions with Black Fox. San Dimas always was their key asset and is actually valued at 239 Million USD. This valuation is based on the offers they received from potential buyers.
The whole company is actually valued at 179 Million! That is around 90 Cent per share and it is actually traiding around 0,07! Am I the only one thinking that this is way to cheap?
There are some additionally risks like the tax dispute, so I think around 30 to 50 Cent is a possible price one can get for the whole company today!
And last: I think all discussions with WPM and potential buyers/partners are already done! Primero now has to choose between selling San Dimas, selling the whole company or trying to find new finaciers or partners to remain as an independent company.
WPM has already signed their will to adjust the streaming agreement!
Tomorrow will be interesting!
