Helium Evolution Is A Logical Acquisition Target!Bancroft Capital's March 2022 analyst report stated that Helium Evolution's Land value based on peer comparison suggests a range of $1.25 to $1.71/sh FD. Based on HEVI’s 170 leads, we expect it could drill 71 risked prospects. If we assume that the prospects average two wells each, HEVI will have a continuous drilling program extending to Q3/43 that will recover 17.2 BCF of helium between 2023 and 2050. The BTAX NPV10 for a 71 prospect development is $697MM or $8.02/sh FD using the current share count.
https://www.heliumevolution.ca/wp-content/uploads/2022/03/22-03-25-HEVI-Report-FINAL-for-posting.pdf Each new discovery increases the value of the company. Helium Evolution is just getting started!
The current value of the company's property due to its proximity to known helium discoveries (Weil Mankota Pool) should give it a value of at least $1.25 per share. Any future discoveries of commercial quantities of helium only add multiiple dollars/share to its value.
If the company's drilling results hit commercial grade helium on 71 of its potential targets, the estimated value of the company's assets could reach as much as $8.02 per share based upon a 2022 valuation.
Part of the company's property is under a 20/80 joint venture agreement with North American Helium, a much larger private company.
https://nahelium.com/operations/development/ However, another private company, the Weil group also has property holdings in the same region of Saskatchewan. So they may also be keenly interested in HEVI's exploration efforts to date.
https://weil-group.com/projects/ Once commercial production from the joint venture commences, one could assume that Helium Evolution would no longer need the financial assistance of NA Helium to continue with the rest of its property development. So it would be a most logical move for NA Helium or another interested petroleum operator such as Weil group to start an immediate M&A action as soon as the company's exploration efforts have met with success! (Any petroleum company, public or private, interested in gaining a greater low carbon footprint could also be suitably impressed!)
Any company's shareholders potentially involved in any M&A action need some greater convincing prior to any takeover bid! Understandably so!
For them, the proof is in the pudding! This expression is very apt for investors who want to make a lot of money and are williing to wait!
But now since Helium Evolution is on the verge of making a huge discovery, the waiting may soon be over!
The longer they wait, the more it will cost them to buy the company out!
I might prefer to receive a very handsome dividend from my shares. But a very sweet take-over bid would also be very welcomed indeed!
All the best! Java