This report provides a summary of Gold & Precious Metal Funds that hold:
- The Acquired Company only: ATAC Resources Ltd. (TSX: ATC)
- The Acquirer only: Hecla Mining Company (NYSE: HL)
- Both the Acquirer and the Acquired Company
US-based silver miner Hecla Mining Company (NYSE: HL) has agreed to acquire all of the issued and outstanding shares of Canada-based exploration company ATAC Resources Ltd. (TSX: ATC) for a consideration of C$31 million (US$23 million). Upon completion of the deal, Hecla will gain ownership of the Rackla and Connaught exploration projects located in Canada’s Yukon Territory, where Hecla is developing one of the world’s largest high-grade silver mines in the Keno Hill district. The US-based mining company will also invest C$2 million (US$1.48 million) for a 19% interest in the seed capital round for a new exploration company, to be named Cascadia Minerals.
Founded in 1891, Hecla is the largest silver producer in the US. With the Keno Hill silver property, which has 49.5 million oz. of silver in Proven and Probable reserves, Hecla is also expected to become the largest and highest-grade primary silver producer in Canada. Between 1913 and 1989 Keno Hill produced over 200 million oz. of silver, making it the second-largest historical silver producer in Canada.
Hecla noted that it is ‘uniquely positioned’ to pursue the Rackla and Connaught exploration projects because of the company’s technical know-how, and financial condition, and that the company will also be advantaged by existing assets located in the Yukon Territory. On the Rackla property, Hecla will be furthering the 16 years of work already undertaken by ATAC on two separate mineralized trends (Rau and Nadaleen), each exhibiting distinct gold occurrence types. The Connaught property is located 65 km west of Dawson City and has historically been explored as a high-grade silver-lead-zinc-copper-gold vein prospect modeled after other mines in the Keno Hill district.
Gold Funds with ATAC Resources or Hecla Mining
Portfolio Holdings Summary
At the time of the most recently recorded asset allocation, 2 funds retained holdings in only the acquired company – ATAC Resources Ltd. (TSX: ATC): LF Ruffer Gold Fund and Mackenzie Precious Metals Fund. These funds should receive the highest material performance benefit from this acquisition news announcement.
23 funds held only Hecla Mining Company (NYSE: HL), and 2 funds held both ATAC Resources Ltd. (TSX: ATC) and Hecla Mining Company (NYSE: HL).
Hecla Mining Company (NYSE: HL) has moved to consolidate exploration and development holdings as a leading primary silver producer in a tier 1 jurisdiction. As mergers continue to reduce the total number of portfolio company holdings, more capital will head to mid-tier and smaller exploration companies. The newly created Cascadia Minerals will service the growing interest in exploration investment.
A copy of the full report is available here.
MineralFunds.com provides prices, performance and trade information for metal ETFs including Precious Metals, Battery Metals, Platinum Group Metals and Base Metals. MineralFunds.com also provides comprehensive fund information, including asset allocations, for Gold & Precious Metals Managed Funds from all investment jurisdictions.
Report prepared by: Kay Samnani, Analyst supported by Christopher J. Berlet BSc, CFA
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