Connect with us

Precious Metals

Southern Silver closes Cerro Las Minitas purchase, now owns 100%

 
Southern Silver Exploration (SSV.V) has now closed the acquisition of the 60% stake in Cerro Las Minitas from Electrum Global Holdings, a deal that was originally announced in June. On […]

Share this article:

Published

on

This article was originally published by Caesars Report

Southern Silver Exploration (SSV.V) has now closed the acquisition of the 60% stake in Cerro Las Minitas
from Electrum Global Holdings, a deal that was originally announced in June. On
the back of the announcement, Southern Silver was able to raise C$14.5M by
issuing 50 million sub receipts at C$0.20 and an additional 19M sub receipts at
C$0.21 (the sub receipts will be converted into units consisting of a share and
half a warrant now the transaction has been completed) and a separate
non-brokered placement of 1.2 million units priced at C$0.38 per unit.

That’s approximately US$11M in cash and
US$5M was used to pay the initial fee while an additional 2.34M shares were
issued as well. Now Southern Silver will only have to make two milestone
payments of US$2M in cash  and US$2M in
shares on both March 15 and September 15 2021. The cash inflow from these
financings as well as the existing cash on the balance sheet should ensure the
swift payment of the remaining cash payments while the total dilution by
issuing shares for the share payments will remain very limited considering the
SSV share price has tripled since announcing the deal, helped by a strong zinc
and silver price.

Additionally, we can reasonably expect a bunch of the 25 million warrants with a strike price of C$0.25 and 9.5 million warrants with an exercise price of C$0.28 to be exercised in the next year or so. Southern Silver now has approximately 218 million shares outstanding giving it a market capitalization of approximately C$140M. Thanks to the strong zinc and silver price, the NAV of the Cerro Las Minitas project is increasing and we will be updating our economic scenario we put together last year. Using a silver price of $16.5/oz and a zinc price of $1.1 per pound, we ended up with an after-tax NPV7% of US$294M but now silver is trading above $25, we can expect a reasonable boost of the NPV of the project.


Disclosure: The author has a long position in Southern Silver and participated in the subscription receipt offering. Southern Silver is a sponsor of the website.

ax
silver
zinc

Share this article:

Precious Metals

3 Penny Stocks to Take Seriously in 2023

It’s not just crypto winter that has many investors down. The year has also been gloomy for most penny stocks. While selected stocks have outperformed,…

Share this article:

Continue Reading
Uncategorized

Top 10 at 10: Which gold explorer just hit a bonanza?

Among the markets winners early, gold explorer Greenstone Resources (ASX:GSR), and rare earth element play OD6. … Read More
The post Top 10 at 10: Which…

Share this article:

Continue Reading
Uncategorized

Powell Pushes Dow Back Into Bull Market As Dollar Crashes To Worst Month In 13 Years

Powell Pushes Dow Back Into Bull Market As Dollar Crashes To Worst Month In 13 Years

It’s been a tempestuous month as China COVID restrictions,…

Share this article:

Continue Reading

Trending