Stockhouse Canadian Small and Micro-cap Stock Report for Friday, March 5, 2010
TORONTO (SHfn) – General Moly (TSX: T.GMO, Stock Forum) shares soared 54% to $4.11 on Friday after the junior miner announced an investment and strategic relationship with Hanlong (USA) Mining Investment Inc., a wholly-owned subsidiary of China’s Sichuan Hanlong Group, that is anticipated to provide full project funding for the its 80% owned Mt. Hope molybdenum project in Nevada. Highlights included a $665 million bank loan from a Prime Chinese Bank to be procured and guaranteed by Hanlong at an anticipated rate of Libor plus 2%-4%, as well as an $80 million equity investment in General Moly through the purchase of 25% of the company's fully diluted shares, partially contingent upon completion of the $665 million bank loan.
As well, shares of West Energy (TSX: T.WTL, Stock Forum) shot up 18% to $5.02 as Daylight Resources Trust (TSX: T.DAY.UN, Stock Forum) reported it will acquire all of the outstanding common shares of West for approximately $570 million, including currently estimated net debt and transaction costs of $135 million. Consideration for the transaction is comprised of $115 million of cash, with the remainder to be paid in Daylight trust unit equivalents. Based on the expected fully diluted shares outstanding of West at the closing of the arrangement, each West shareholder will receive, at their election: (a) $5.50 in cash, or (b) 0.465 of a Daylight trust unit equivalent, or (c) a combination thereof for each West share held. Based on the 10-day weighted average price of Daylight trust units ending March 4, 2010, and cash to be paid, West shareholders will receive an aggregate $5.30 per share.
Forest Gate Energy (TSX: V.FGE, Stock Forum), meanwhile, said it has mobilized a rig at its discovery well located on its Crescent Junction property near Green River, Utah, for production testing of the four shallow oil zones. Forest Gate holds a 50% working interest in this well. Production casing was run to a depth of 1,100 feet for production testing of the four shallow oil zones. Good, clean porosity was noted in each of these zones, with the hydrocarbon described as good-quality, light sweet crude, 35 - 40 API oil. Forest Gate stock popped 16% to 67 cents.
Shares of Vault Minerals (TSX: V.VMI, Stock Forum) powered 40% higher to 45.5 cents after Queenston Mining (TSX: T.QMI, Stock Forum) agreed to merge with the junior explorer. Vault shareholders will receive one Queenston common share for every 10 Vault common shares. In addition, all convertible securities of Vault will be exercisable in accordance with their terms for common shares of Queenston on the same basis. Based on approximately 40 million common shares of Vault issued and outstanding, Queenston will issue about four million Queenston common shares pursuant to the amalgamation. The transaction values Vault at 50 cents a share.
And, shares of Tasman Metals (TSX: V.TSM, Stock Forum) continued move higher Friday, up 14% to 65 cents. Late Thursday, Tasman reported assay results from the first five drill holes its 100% owned Norra Karr rare earth element (REE) - zirconium (Zr) project in Sweden, which included 108.1 metres at 0.74% TREO (total rare earth oxide), 2.1% ZrO(2) (zirconium oxide) with 52% of the TREO being heavy rare earth oxides (HREO).
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