US Investment firm buys a position in GCMInteresting article on gold I came across when trying to learn more about GCM tonight. I don't think it's been posted by anyone here.
U.S. Global Investors has recently bought a large position in GCM. I am unable to find out just what exactly a 'large position' means, but here is what Frank Holmes - CEO and Chief Investment Officer - had to say about Gran Colombia:
"I think any big-cap company is going to have to end up looking for those companies that have 10 million ounces (Moz.) in reserves and acquire them. One of the companies that we have taken a big position in isGran Colombia Gold Corp. (TSX.V:GCM), which has over 10 Moz. of reserves and one of the best valuations. You are only paying $45/oz. of gold in the ground. Gold producers trade at six to seven times that level. That makes it a takeover candidate. It has a higher grade and is producing over 100 thousand ounces (Koz.), with plans to ramp up to 400 Koz. of gold production. We like to buy where we get a big bang for our buck—lots of gold-per-share.
To increase production and not dilute the shareholders, the company just raised $80M by issuing a 5% silver note. It is convertible at $15/oz. of silver, which allows you to buy silver at a massive discount. That gives them the cash to ramp up production for the final build out phase. This is brand new and very interesting. We like to invest in those types of companies. We like those companies that are very protective of themselves on a value-per-share basis."
The link to the full article which included commentary on some other gold companies is below:
https://www.citizeneconomists.com/blogs/2011/08/18/frank-holmes-gold-is-for-fighting-deflation-not-inflation/
Full disclosure: I own GCM stock. I've recently averaged down at the current share price and I am considering buying more.
This isn't a pump, but I'm tired of the bashers here, so it's a bit of positive news worth sharing. I don't see the share price breaking out any time soon. Do your own DD.