Five months ago when we first spoke to Canarc’s CEO Catalin Chiloflischi he outlined a new plan which was to copy the hugely successful business model of Bard Cooke’s Endeavour Silver.
On July the 15th, Canarc announced a deal where they become a ~35% shareholder in Santa Fe Gold, basically a $3 Musd investment that is already worth north of $8 Musd (to compare with Canarc’s Mcap of roughly $15 Musd). The Canarc/Endeavour team will take over Santa Fe in terms of management and BoD positions, organize the re-financing of Santa Fe’s Summit Mine and put their mining engineers, geologists etc. from Endeavour Silver at work to make sure the mine re-start is successful.
To sum up, Canarc Resource are making Santa Fe Gold (OTCBB:SFEG) look like the turn-around story of 2014, while at the same time not taking on any financial risk or debt themselves. A win-win deal for all parties involved, shareholders of both companies included.
At Gecko Research we like to follow the people, which in this case mean Catalin Chiloflischi and Brad Cooke. We currently have a position in Canarc Resouce Corp.
Related articles and news releases
* Santa Fe Gold and Canarc Resource Announce Strategic Share Exchange; Commitment for $22 Million Gold Bond Financing; Restructuring of Santa Fe Debts With Senior Secured Creditors (Jul 15)
* Deal could revive Santa Fe Gold (Jul 21)
* Bradford Cooke aims to repeat Endeavour success at Santa Fe (Jul 22)
Santa Fe Gold’s website