Anaconda Delivers Again and Again and Again
I began to write about Anaconda well over a year ago. I have written about them half a dozen times. I love this company.
The stock was $.115 but that was before a 4-1 rollback so at today’s price, the shares have dropped by a third in spite of them delivering outstanding results again and again and again.
They are still trying and the latest numbers are 59.39 g/t gold over 7.0 meters and 6.17 g/t Au over 8.0 meters. If that doesn’t do something better than provide a liquidity event, I will hang up my spurs and change the site to 321golf and go chase small white balls around in the snow.
I don’t think readers would be terribly surprised to know that management of mining companies often talk to writers about things that don’t meet the standard of needing to put out a press release. We want to know what they are doing for the future. What’s in the mill?
Anaconda management realizes that they need to escape the hobby-mining group. Yes they are mining but the market gives them no credit for their very real production. Which by the way, they just increased to a record 20,149 ounces of gold, ten percent above guidance. They have to get well above 50,000 ounces of annual production for any credit and over 100,000 ounces before the market takes a real interest.
Right now they are too small and they know it. But I have known for well over a year they have been trying to figure out how to put all the too-small-to-matter deposits in the neighborhood together with good management to make a real soon to be mid-tier mining company.
They had talked to Resource Capital Gold Corp (RCG-V) about doing a merger over a year ago but management of RCG had their heads stuck where the sun don’t shine and it wasn’t worth Anaconda giving up so much of the merged company for so little in return.
The brilliance of RCG management shone brightly recently as the company was forced to halt trading as they figure out how to go into bankruptcy. A company that was as high as $.34 three years ago has fallen off a cliff by 97% as the shares dropped to a penny before being halted. George Young also of Palladon fame is getting very experienced at spending companies into a hole before bailing out to let others try to pick up the pieces.
In January of 2018 Anaconda made an offer to merge with Maritime Resources (MAE-V) at a 40% premium. Maritime owns 100% of the million ounce plus Hammerdown gold mine previously operated by Richmont Mines at a grade above 15 g/t gold. Alas, Maritime was run by a management team interested only in collecting paychecks for as long as possible before the shareholders wake up and give them the boot. And they did a financing just before the Anaconda offer was going to be complete in order to reward favored shareholders. They expected Anaconda would pay any price to get the project.
Dumb bastards. They screwed everyone, their ordinary shareholders who got a 40% drop in price, the “favored” shareholders who went into the PP only to see the price plummet and naturally the Anaconda shareholders who could have made a silk purse out of the sow’s ear. But the management group got to keep cashing those paychecks. It’s called running a “lifestyle” company where you get the punters to pay for your absurdly expensive lifestyle in return for nothing.
Anaconda didn’t fall for the scam and dropped the offer. They watched the share price of MAE drop by 50% as a result.
There are several different juniors in Newfoundland and Nova Scotia who would benefit from being put together with a real management team. One has a mill; another has a million ounce plus deposit. RCG had both a mill and a small resource but no management. Anaconda needs to put together a package that works for all of them. I know of nothing in the works, no offers, no discussions that are non-public, I just know Dustin Angelo of Anaconda and I would be shocked if he stopped thinking about the future and how to make more money for his shareholders.
I was looking at a spreadsheet a few days back and over the past eighteen years we have dealt with over 500 companies as advertisers. I know most of the players in the industry, some very well. If I compared the management teams of all those companies, Dustin has a team that would be in the top ten. The market may not yet get it but they will some day. As I have said many times all you have to do to make money in the resource sector is to buy cheap and sell dear. It is no more complicated than that.
Anaconda is cheap.
I have bought shares in the open market. Anaconda is an advertiser and as such I am biased. Do your own due diligence but all you have to do is read all the positive news from the last year and I think you will agree with me.