Share Price DivergenceInteresting to see Klondex shares up 1.7% while Hecla shares were down 1.8%. The diff is 3.5% suggesting share buying pressure in favour of Klondex - the next short reports should provide some insight.
There is a lot of chatter about Hecla underpaying for the Klondex and this has prompted a couple of law firm to question the valuation. The reality is this process was administered by the investment bank retained by Klondex. To suggest that Klondex did not run a fair process or precluded other interest parties from bidding is a little over the top. IF THERE WERE OTHER BIDDERS, THEY WOULD HAVE STEPPED UP. Now that Hecla has made its move, those other parties have every right to make an offer if they believe the assets are worth more. I think this ship has sailed and Hecla has picked up an asset that will be transformational for them once they get the assets rationalized and producing the cash flow of $40-$50M.
You might have noticed the rating agencies put Hecla credit rating under review with "POSITIVE" implications. Hecla is the big winner here if as and when they get these assets.