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RomanovPerson was signed in when posted
08-01-2016
02:15 PM ET (US)
I’ve posted on Golden Arrow before:
Later this year, Silver Standard Resources (SSRI) will announce if they are proceeding with a major joint venture agreement that will combine SSRI’s Pirquitas silver mine with GRG’s Chinchillas silver project. SSRI’s Pirquitas is Argentina’s #1 producing silver mine with over 10 million oz of silver produced annually, but it has a limited mine life. SSRI is currently focused on expanding the mine life of Pirquitas – and GRG’s nearby Chinchillas silver project contains 155 million measured/indicated silver equivalent oz!
If SSRI elects to proceed, GRG will receive a 25% stake in the Pirquitas/Chinchillas combination – and SSRI will use GRG’s Chinchillas to supply feed to their Pirquitas plant. SSRI finished last week with an enterprise value of $1.03 billion vs. GRG’s current market cap at $1.23 of only $94.71 million. NIA estimates that half of SSRI’s enterprise value is for Pirquitas – valuing it at USD$515 million or CAD$672.18 million. This gives GRG’s Chinchillas an implied valuation of CAD$224.06 million, which divided by GRG’s 77 million shares outstanding – would value GRG at $2.91 per share, without giving GRG any additional value for its other silver projects in Argentina.