Stockwatch Canada Comment and Recap Christina McCarthy and James Gowans's Paycore Minerals Inc. (CORE) had a good day, jumping 34 cents to $2.06 on 6.9 million shares thanks to word that Ewan Downie's I-80 Gold Corp. (IAU) is making a friendly offer for the company. I-80 is offering 0.68 of a share for each Paycore share, which is a 26-per-cent premium to last week's closing price. Naturally, I-80's stock did not fare as well, as it fell eight cents to $3.10 on 2.65 million shares on the news of the offered premium.
I-80 is after Paycore's FAD property in the Eureka district of Nevada, immediately south of and adjoining its own Ruby Hill property. Paycore had been planning a 16,000-metre drill program at FAD this year after its successes of 2022, in which it scored drill hits of up to 1.96 grams of gold and 92.6 grams of silver per tonne over 25 metres, accompanied by 7.45 per cent zinc and 1.26 per cent lead. Meanwhile, the more advanced Ruby Hill project is home to an underground resource of 1.2 million tonnes indicated at 5.22 grams of gold per tonne and 8.2 million tonnes inferred at 6.02 grams per tonne, nearly 1.8 million ounces of gold.
I-80's shareholders might have been grumpy, but the company's management was fluttering pompoms with glee. Mr. Downie, CEO, applauded the geological setting being defined in the Eureka district as "truly the most unique I have witnessed on my career" -- gushing freely about the oxide gold, Carlin-type refractory gold, base metal skarn and polymetallic carbonate replacement mineralization present. And so, with the addition of Paycore's property, the expanded I-80 project in the area "has the potential to host a world-class polymetallic deposit with enhanced potential for further discoveries."
The deal is also great for Paycore's backers, assures Ms. McCarthy, that company's president and CEO. She says the merger gives them greater exposure to the Eureka district and to I-80's other projects, while also delivering a significant premium and enhanced liquidity. Mr. Gowans, Paycore's chairman, was thinking more along the lines of Mr. Downie. He applauded the mineralization on both company's Eureka-area properties as "indicating a massive carbonate replacement system along the fault corridor between the two properties." And so, he says, the combination of the two is "shaping up to be among the highest-grade carbonate replacement deposits in the world."