Bay St. Minute: Bay St. Blues and Betting on Molycorp
Received a text from a friend this morning that I had drinks with at Hemingway’s in Yorkville Wednesday night explaining that he had been advised to do more yoga and less drinking after I witnessed a scene where it looked to me like he was being shaken by his neck like a Muppet by the hands of a gentleman who I had been informed was his dear friend less than 5 minutes earlier. Apparently this “may” be some kind of “Bay St. Blues” symptom read the text explanation. I opted to reference this story, because I think we have all been shaken up this year in the markets, and Molycorp certainly has the symptoms…
This morning I was reviewing all of the illustrious content on Mark Smith’s departure from Molycorp and was considering my own experiences with Mark. It’s true, behind-the-scenes we all speculated when this inevitable event was coming. Especially with some of the numerous aggravating factors such as Molycorp’s shares tumbling 87% from their peak at more than $79 last year to less than $11 this week or the ongoing correction to rare earth pricing. Toss in the impact of raising capital in this market sector and there are few that could weather this storm.
This said; allow me to give Mark and the Molycorp Board their dues for the Molymet deal and their acquisition of Neo Material Technologies.
With all of the interactions I had with Mark over the years, I never felt like I knew him. Recently I had been informed through Jim Sims that Mark felt that the work we were doing was beneficial to the sector; however, Molycorp has been to date one of the only company’s in the industry that are not members. In spite of this, we have been clear on Why Molycorp Matters and have held firm in our support.
This year in a story titled The Best Rare Earth Company in the World, I quote Constantine Karayannopoulos on the vision of what Molycorp would become, having acquired the star in the industry — Neo Material Technologies. Constantine has always had vision, and he has proven that he is resilient, strategic and arguably the best at developing relationships in both China and Japan. So while we are being fed news releases, which clearly articulate his short term intentions as they secure a new CEO, all I can think of is that if we are betting on Molycorp’s success, then they will need to convince him to stay.
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An accomplished entrepreneur and corporate finance professional, Tracy Weslosky is the CEO for InvestorIntel Corp. and the VP of Business Development for Bellotti Capital Partners ... <Read more about Tracy Weslosky>