Capstone and GMI to merge???? PescodThis sounds very plausible. GMI hasn't rounded up a CEO aftermonths. Why not? Well, if a merger is in the works, no reason to. Andwhere did all the sudden buying interest come from?
From Pescod's Late Edition:
The chart at the left of Metallica Resources shows that big
companies are definitely valued better than small companies
because of the only news out of Metallica recently...we’ve all
noticed and some of us such as ourselves have whined that
over the past year or so despite the boom in commodity
prices, it has mainly been the big companies in the gold sector
such as the Goldcorp’s, Barrick’s and Yamana’s of the
world that benefited from higher gold prices and not the Aurizon’s
and Lake Shore’s of the world. The same thing is happening
in the copper sector.
So now that many observers have noticed that since Metallica
has announced its merger with New Gold and Peak
Gold has created this interest in Metallica. A merger such as
this creates a much bigger company with a market cap of
roughly $2 billion and it does give some synergies in that the
new company will need less executives and it will give diversity
as far as how many mining operations in different countries.
So now we hear all sorts of rumors and gossip of many
different miners trying to merge to get the better market capitalizations.
When we were at Joe Martin’s Cambridge House
conference last weekend, there was all sorts of gossip. But
how would this one work between two copper miners—
Globestar Mining, with its mine about to be in production this
summer in the Dominican and Capstone Mining, which is currently
operating the Cozamin copper/silver/zinc/lead mine in
Zacatecas State, Mexico.
To us, this sounds like a great marriage of two miners in
two countries that could reduce executive costs and country
risk and definitely make for a bigger company. It’s definitely
one of only a thousand rumors out these days, some of
which might be true and some of which might be rewarding.