Off-Take Financing...First Glance...Crunching Numbers..As per the news release the Off-Take Option offered to Samsung included a 10% ownership stake regarding the Crawford Property for the amount of basically 100 million US. upfront.
At first glance it looked good...many...including Selby put a value on Canada Nickel at about 1 billion US. However, the figure has no merit in my opinion without the cash being put on the table...it would appear that the market does not believe it at this time. Selby himself stated that with this press release it would put the stock price at $7.00...really?
Would that not be nice?...they could finance part of the @ 2 Billion US price tag of the Crawford Project with an issue of their own stock. That is what puzzles me...most projects that are "this good" should in theory have the means to use their stock to help finance the project...not in this case. Not only that with the purchase of the 15.6 million shares that would put Samsungs stake with a value of 109 million Canadian...Wow! Something does not add up...I wish it was this easy...to be sure! What a profit in such a short time.
Remember...back in November 2023 the stock price hit a low of $.89.
As apapas1973 mentioned, Selby has been in talks with 20 possible off-take entities and it is quite possible he may sign on a couple...ok..let us take a look using recent history of the Samsung option.
If he signs up similar entities he would have to give up 10% each time? If he signs up a total of three for example...he would have 300 million US for Crawford...but...wait a minute now Canada Nickel only owns 70% of the project. This cannot work...I was looking for an off-take agreement that would involve a minimum of 200 million US. Even with 300 million it is not close to being enough...potential financers with not put up the rest...too much risk involved...not going to happen.
Listen, I would love for all of us to make a bundle...however, this is not adding up for me.
Now...Agnico Eagle has made the best investment with minimal risk...they are astute when it comes to board decisions regarding investment opportunities. In my opinion and due to the fact that they purchased flow-through shares which can only be used for exploration purposes they are going to push for a more thorough exploration program in the region and further pursue more definition drilling at Crawford before they commit anything further. I still to this day do not believe that they have put enough holes into Crawford...let us see. In their press release they mentioned "early stage" investment...going to take years for further drilling.
I can tell you with the utmost degree of confidence that no entity is going to purchase the company to the tune of "big bucks" before doing follow up drilling of their own @ their team of professionals...to be sure!
All the Best!
Digger0144