Asiamet Resources has pulled off what small-cap dreamers sketch on the back of napkins: flog a tricky asset for a pile of cash and promise shareholders a decent slice of the spoils.
Shares in the AIM-listed copper explorer are up 40 per cent this week after it agreed to sell its interest in the KSK project in central Kalimantan, Indonesia, to Norin Mining of Hong Kong for £81 million.
Even after the week’s ascent, the market capitalisation is still £30 million shy of what’s being paid for KSK.
With 53 per cent of shareholders already backing the transaction and a general meeting set for late January, this looks like a done deal — barring any regulatory gremlins.
‘This is a landmark transaction,’ said chair Tony Manini, who reckons the deal ‘delivers a strong return for our shareholders.’ Assuming, of course, the proceeds don’t disappear into the corporate ether.
A special dividend is on the cards, though nothing’s confirmed. A resource minnow unloading a copper project for nine figures is worth a cheer.
The AIM All-Share felt the trickle-down from Wall Street’s ‘brain-fart’
Sticking with the sector, Anglesey Mining shares have seen what’s termed a ‘dead cat bounce’ (the theory being that dropped from a sufficient height, even a deceased moggy will show some elastic qualities).
Anyway, the stock more than doubled in value on no news. Prior to this, an aborted fundraiser and capital reorganisation torpedoed the natural resources group’s valuation, which now stands at a mini micro-cap £100,000.
Oracle Power shares rose 19 per cent after drilling resumed at its Northern Zone gold project near Kalgoorlie.
A two-week grade control programme is targeting shallow gaps between known mineralised zones, with results expected shortly. Chief executive Naheed Memon said recent intercepts had ‘increased the footprint with every drill campaign’ and called the work a key project milestone.
Turning to the wider market, the AIM All-Share felt the trickle-down from Wall Street’s ‘brain-fart’, with the small-cap index off almost 3 per cent at 749.72. Its benchmark, the FTSE 100, was more resilient, moving 0.6 per cent lower.
The week’s biggest faller was a bit of a bad news/good news story.
Buccaneer Energy shares fell 36 per cent after raising £500,000, issuing shares at a discount and, of course, prompting the usual grumbles about dilution.
However, the new investment is being put to good use and should generate long-term value for investors.
It is being used to expand output and monetise associated gas through a new Bitcoin mining initiative. I know — gas to crypto; how does that work? Well, when you have a surfeit of cheap power, it is possible to parlay this into the processing required to mine virtual coins. It will be interesting to see how chief executive Paul Welch and the team get on.
Union Jack Oil fell 25 per cent after its latest well in central Oklahoma failed to produce commercial quantities of oil, despite initial signs of promise.
It was another tough week for Next 15, the London-listed marketing services group, which tumbled 22 per cent after it terminated talks with private equity firm Epiris that would have seen it taken over for £230 million.
There’s an old stock market adage that says it is often better to travel than arrive — and this seems to be the case with Rockfire Resources. Up 61 per cent in the last six months, it tumbled 22 per cent on what, on the face of it, were decent early exploration results from its Molaoi project in Greece.
And finally, Avacta’s latest data showcase a significant advance in cancer drug design.
The company has demonstrated that its proprietary pre|CISION technology can deliver two different anti-cancer drugs into a tumour simultaneously — an achievement that could redefine the economics and effectiveness of targeted chemotherapy.
The announcement, made at the AACR-NCI-EORTC conference in October, marks the first proof that Avacta’s platform can release dual payloads from a single molecule.
For a company whose market capitalisation stands at just under £290 million, this progress underscores why investors have been watching it closely.
The shares ended the week 7 per cent higher.
For all the market’s breaking mid- and small-cap news, go to www.proactiveinvestors.co.uk
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