Pinned straw:
14-Dec-2023: Genesis (GMD.asx) has just agreed to buy a couple more gold projects, this time from Kin Mining (KIN.asx).
GMD-to-acquire-the-Bruno-Lewis-and-Raeside-gold-projects.PDF
GMD-Reporting-on-select-Kin-Mining-gold-projects.PDF
Kin-Receives-$535m-from-Sale-of-Gold-Deposits-to-Genesis.PDF
That's $53.5m, not $535m as the KIN announcement file name suggests - can't have dots in the middle of file names - I wish companies would stop doing that, as it can give an entirely wrong impression until people open the announcement and read it properly.
Below is the first Page of GMD's first announcement, with some notes from me on the right:
Map from page 2 of that same announcement:
As I write this, GMD's SP is up +8% at $1.80 (closed at $1.665 yesterday), however they spiked up to as high as $1.90 this morning which was +14.1% above yesterday's close. They got down to below $1/share in mid March, so they're up over +80% from there.
KIN is up +10%, but were up +16.7% earlier at 7 cps (closed at 6 cps yesterday, currently trading at 6.6 cps).
The rise in the GMD share price today might seem a bit overdone for such a small acquisition, but it's more about the fact that the market may be coming around to my way of thinking in terms of Raleigh being less likely to be bidding for RED (Red 5) now. My argument is that RED has now become too expensive, and their mill is no longer needed by GMD now or in the near term, AND that SLR have a blocking stake in RED that they would almost certainly use to frustrate any takeover of RED that GMD might attempt. It would be a negative if Raleigh tried to go after RED at current levels because he would almost certainly be overpaying, however with every small acquisition like this the likelihood of GMD making a near-term bid for RED reduces in the eyes of the market.
In short - the roll-up (growth via acquisition) model remains intact without Genesis clearly overpaying for any assets that they are acquiring - so all good, thesis remains on track. The market is liking the progress to date.
Sidenote: Saturn Metals' (STN's) Apollo Hill gold project is absolutely in the firing line for Genesis Minerals. Apollo Hill is around 40km south east of the Gwalia (Leonora) Mill. RED's KOTH (King of the Hills) mine and mill are around the same distance north west of Gwalia/Leonora (see map above). RED's market cap is $1.17 Billion. STN's m/cap is less than $40 million - currently $33.46m according to the ASX website. Genesis could buy all of Saturn (STN) for less than $100m, or just Apollo Hill, although the price difference wouldn't be much considering Apollo Hill is STN's main asset. They bought it off Peel Mining (PEX) in mid-2017.
That's from the Saturn Metals website: https://saturnmetals.com.au/projects/apollo-hill/
...which needs to be updated - as it shows Gwalia as still being owned by SBM and Mt Morgans still being owned by Dacian (which is now 100% owned by Genesis) - plus it shows Apollo Hill as having 1.47 Moz (million ounces of gold) in the ground (see below) but the up-to-date map from today's GMD announcement (scroll up for that - towards the top of this straw) shows Apollo Hill as having 1.8Moz. Not particularly high grade, but close to Leonora. Raleigh would have an eye on that one for sure.
Disclosure: I hold GMD shares, and I have STN on a watchlist now.
That's a better buy than RED is at current levels - for sure. The major differences are that RED are in production, have WAY more gold, at higher grades, and a very decent mill as well, but they're priced for all that at over $1 billion. So STN is high risk for sure, and RED is expensive but de-risked. If I was to invest in STN, it would be an appropriately small punt rather than an investment, because they don't make any money, and they could go broke if they're not taken over by somebody like Genesis. High risk means I would put way less money at risk, but I'm not pulling the trigger on them yet - just on a watchlist for now.
05-Jan-2024: I was talking about how Saturn Metals (STN) would be on Raleigh Finlayson's radar as a possible potential acquisition for Genesis Minerals (GMD) - at the right price - due to the location of STN's flagship Apollo Hill Gold Project within that 50 km radius of Leonora. It would appear that STN may now be "in play" - as their SP rose +9.09% yesterday to close 1.5 cps higher at 18 cps, and they got as high as 22.5 cps today - with the ASX website saying they closed at 21.5 cps, being up +3.5 cps or +19.444% for the day but Commsec saying they "only" closed up +11.11% (up 2 cps) at 20 cps due to a couple of small ($100) Chi-X (Cboe) trades at around 3:52pm and 3:54pm priced @ 20 cps (shown on the screenshot below - from Commsec), which are not reflected on the ASX site at this stage (they might be later).
If you zoom out to 3 or 5 years, STN have come down from around 88 cps to be less than one quarter of that today, but in terms of the past couple of months, they've gone from 13 cps in November to as high as 22.5 cps during today, which is +73% higher than that 13 cps level.
The Saturn Metals directors have three tranches of options, exercisable at 80 cps, 28 cps and 20 cps respectively, with those 20 cps options issued most recently (in December) after being approved in November by shareholders at Saturn's 2023 AGM.
For a company with a tiny $44.7m market cap, they have a few substantial holders:
The argument could be made that there is some "smart money" on the register.
I hold GMD shares, but not STN shares at this stage - but I am watching STN. I think there's something going on with them. I'll be watching to see if there is a notice lodged next week for either a new Sub, or a change of existing Sub's interests for STN.