this looks interesting. we should be thinking about junior goldlproducers that make sense as acquisition candidates. crj is a near prodcuer at madsen.
miningweekly.com
Aurizon has received informal merger interest, CEO says
By: Matthew Hill
Published: 15th March 2012
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TORONTO (miningweekly.com) – While Aurizon Mines, which reported a 211% increase in fourth-quarter net profit to C$21.8-million on Thursday, and has five or six companies it is considering buying, it has itself received informal approaches regarding potential mergers, CEO George Paspalas said in an interview.
If due diligence and valuation negotiations were successful, the TSX-listed miner could close an acquisition in the short term, he told Mining Weekly Online.
Aurizon has been hunting for acquisitions since at least 2009 under previous CEO David Hall, who became chairperson in October last year, but has struggled to find anything that fits its picky criteria. To receive the company’s interest, a target would have to be producing around 120 000 oz/y, and at similar profit margins to Aurizon’s flagship Casa Berardi mine in Quebec.
“We’ve looked hard, I can tell you that,” Paspalas said, speaking in a telephone interview from the firm’s Vancouver headquarters.
But finding a company that meets its criteria and is also a willing seller with reasonable price expectations has been difficult.
This has prompted Aurizon to shift its focus from producing mines to near-term projects.
“There are a lot of companies out there...that are at a point where they have a pretty good project, but they don’t have any cash – and the shareholders are saying ‘enough’s enough’ in terms of dilution,” commented Paspalas.
That is where Aurizon’s cash flow, a C$213-million treasury, and mine-building experience can potentially step in.
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