First Cobalt (FCC.V) stock ramped up hard Thursday, climbing 20.6% on the news the company had delivered a friendly merger proposal to the Paul Matysek/Bob Cross-led Cobalt One (CO1:ASX).
Details of the merger proposal include Cobalt One making up 60% of the merged company’s stock, the new entity including Matysek and Cross, as well as Cobalt One CEO Jason Bontempo, and the company hunkering down under First Cobalt’s TSX-V listing, while co-listing in Australia.
What brought the two companies together was an earlier partnership around a refinery deal near Cobalt, Ontario, which ended up in a legal battle when the owners of said refinery allegedly tried to gazump FCC.
The two companies own adjoining properties in the area, and their uniting would create a defined front runner in the Cobalt, Ontario camp, with the biggest footprint in the area.
“Both companies believe that a rebirth of this historic mining district will occur through the application of modern geoscience, a better understanding of disseminated cobalt mineralization and ultimately, bulk mining methods. A consolidation of properties, the refinery and the permitted property upon which the refinery is situated offer the potential to significantly shorten the pathway to production. This transaction will benefit shareholders in both companies, while creating one of the largest cobalt exploration companies in the world.” – First Cobalt CEO and President Trent Mell.
First Cobalt owns a large prospect around Silver Centre, south of Cobalt, Ontario, while Cobalt One owns prospects to the immediate east, and northwest leading right the way back to the main camp, where First Cobalt has additional properties.Figure1_FirstCobaltCorp
This isn’t First Cobalt’s first move into joining forces with other companies in the region. In fact, it’s not even their first this week. The company delivered an LOI just yesterday to Cobaltech (CSK.V) wherein it seeks to take all of that company’s shares and assets in a transaction, the details of which have yet to be released.
Cobaltech owns 11 past producing mines in the area, and a 100 tonne per day mill, which would compliment the Cobalt One refinery.
Elsewhere in the region, recently told Equity.Guru that they really like the team at Cobalt Power Group (CPO.V), which would only add fuel to the fires currently kicking up all over Cobalt, Ontario, that suggest we’re in peak merger season in a red hot sector.
— Chris Parry
FULL DISCLOSURE: First Cobalt, Cobaltech, Castle Silver and Cobalt Power Group are all Equity.Guru marketing clients