VMS Ventures (TSX: V.VMS, Stock Forum) shares rallied 18% to close at 35 cents.
The copper exploration company announced it had formed a joint venture with HudBay Minerals (TSX: T.HBM, Stock Forum) to develop a number of copper properties in Manitoba, including the Reed Lake property and the two claims adjacent to it to the south, which are held by VMS. HudBay will own 70% of the JV, and VMS will own the remaining 30%.
HudBay has agreed to make cash payments to VMS, while VMS has agreed to cease its disputation over the location of the boundary between Reed Lake and the southern claims.
The dispute has been a lengthy and costly one, with shares of VMS well off their all-time high of $1.48 in November of 2007.
BFREE2 opined: “Seems to me that we once made it through 40 cents just based on rumors of a JV with Hudbay. Wonder if we'll do it again now that the JV is actually going to happen. Feels like a slow start, considering.”
Many on the board, including Pdcon1 saw the news positively: “HBM is also interested in Super zone and the tower zone and willing to pay cash for 70% interest. VMS has a big brother with big pockets . 30% will pay big money for an exploration co , am I dreaming or is this real. I know I will wake up this morning and Its all a dream.”
Not everyone was celebrating, however. Ramblersrest complained that VMS had given up too much property and too much control. “They just lost 70% of their value . Gave the deposit away almost . Will have to wait for HUD to take their sweet old time again to come under the wire if markets hold up to get ore coming out. Then VMS will have to wait for their share paid off ... HUD will be in control and any favours will go to them.”
But Pdcon1 maintained: “We’re a lot farther ahead here than yesterday and those who want a producing mine today can buy into a number of co in the 20 to 30 dollar range, this is an exploration play with good leverage moving in the right direction.”
And Oldlady62 chimed in with support for VMS’s new larger partner. “HBM will honour it's commitments with VMS at the Reed Lake "mine".
“Remember that HBM's management is a new aggressive team under a new board of directors.
“The cash from HBM will offset our exploration costs incurred and shortly we will receive 30% of revenues from the "mine".
“The border at Reed Lake has been settled.
“HBM is also interested in the other properties 100% owned by VMS.
“VMS's management team is professional, knowledgeable and well experienced
in exploring their claims in Northern Manitoba. They will look after their shareholders.
“Some of the bashers on this BB wanted to see an NI 43-101.
“There you have it HBM knows better. Professional geologists maybe?”