Magna Mining Inc. (NICU:TSX.V; MGMNF:OTCMKTS) closed its acquisition of Lonmin Canada (Loncan) for US$16 million (US$16M), reported Research Capital Corp. analyst Adam Schatzker in a November 7, 2022 research note.
The transaction includes the Denison project and the past-producing Crean Hill nickel-copper-platinum group metals mine, both located to the west-southwest of Sudbury, Ontario. Also in the area, west of Sudbury is Magna's existing project Shakespeare, a past-producing mine with a significant resource.
In addition to a Buy rating, Research Capital has a CA$1 per share target price on Magna
"We believe Magna will likely release a new 43-101 technical report shortly," Schatzker wrote, at which time Research Capital will most probably update its valuation on the Canadian base metals exploration and development company.
Now though, in addition to a Buy rating, Research Capital has a CA$1 per share target price on Magna. Its current share price, in comparison, is about CA$0.40.
To take over Loncan, Magna already paid US$13M and must remit the remaining US$3M within a year of the closing date, relayed Schatzker. The acquirer intends to pay the final tranche in cash but could cover it with Magna shares, priced at the time of issue.
With the closing of the deal, "Magna has satisfied the conditions of the escrow release relating to 71.1 million subscription receipts," Schatzker noted.
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Disclosures For Research Capital Corp., Magna Mining Inc., November 7, 2022
1. The analyst holds shares in Magna Mining Inc.
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Adam Schatzker has visited Magna Mining Inc. in the past 18 months.
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