Oreninc Index Update: February 19, 2015

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Oreninc Index Falls to Reality 

The Oreninc Index returned to reality for the week ending February 19, 2015. Total dollars announced dropped to $38.2m, a two-week low. Two brokered and bought deal financings were announced for $21m, six- and two-week low respectively.

Deal-making for the week continued, albeit on a lower level, with Timmins Gold Corp.’s (TSX:TMM) acquisition of Newstrike Capital Inc. (TSX-V:NES) in an all-stock deal worth $140m. The deal will create a Mexican-focused gold producer, with Timmins shareholders owning around 63% of the company post-deal and Newstrike owning the remaining 37%. Gold prices for the week crashed below $1,200 for the first time since the beginning of the year.

It’s never great to see such depressed numbers after a week as strong as last, though the fact that it came in a holiday-shortened week makes it easier to swallow. We’ll see if the PDAC has any lifting effect as companies try to build excitement leading into the annual meeting of the industry.

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Summary:

  • Number of financings decreased to 16, a four-week low.
  • Two brokered financings were announced for $21m, a six-week low.
  • Two bought deal financings were announced for $21m, a two-week low.
  • Total dollars crashed to $38.2m, a two-week low.
  • Average offer size fell to $1.8m, a two-week low.

Major Financing Openings:

  • Kaminak Gold Corp. (TSX-V:KAM) opened a $21 million offering underwritten by a syndicate led by Cormark Securities on a bought deal basis. The deal is expected to close on or about March 11, 2015.
  • Timmins Gold Corp. (TSX:TMM) opened a $10 million offering on a best efforts basis.    
  • Pinecrest Energy (TSX-V:PRY) opened a $2 million offering on a strategic deal basis. Each unit includes a 1/2 warrant that expires in 60 months.
  • Banyan Gold Corp. (TSX-V:BYN) opened a $1 million offering on a best efforts basis. Each unit includes a 1/2 warrant that expires in 24 months.

Major Financing Closings:

  • Kirkland Lake Gold Inc. (TSX:KGI) closed a $34.52 million offering underwritten by a syndicate led by National Bank Financial on a bought deal basis.
  • Aureus Mining Inc. (TSX:AUE) closed a $19.04 million offering on a best efforts basis.    
  • Fission 3.0 Corp. (TSX-V:FUU) closed a $3.08 million offering on a strategic deal basis.    
  • Kombat Copper Inc. (TSX-V:KBT) closed a $1.36 million offering on a best efforts basis.

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