Thursday, May 23, 2013

Copper Fox Metals - Anger heats up as the silence continues

It's nearing the end of May and not a peep out of the company. Some investors call just to make sure the doors are still open. The tension is palpable. We know they are in talks with Teck over the Schaft Creek project and there's nothing to report that can be told over the phone. Still, investors expect to see a drilling plan or some money raised, anything but silence.

RabidTiger put it this way:

It looks like we might pass by the June 4 "deadline" without hearing anything from the company. Since we don't have a lot of good info, here are a few clues to watch out for:
Annual General Meeting
If Teck does decide to buy us out, we will need to vote on it at a meeting. We've got an upcoming Annual General Meeting that would be the perfect time to vote on a buyout. If Copper Fox thinks we might get bought out soon, it would be poor planning to have a standard AGM and then organize another special meeting afterwards for a buyout.
We will be notified of a meeting on Sedar as a "Notice of Meeting" followed with a Management Information Circular and Form of Proxy. The Form of Proxy will have the items we need to vote on. There is supposed to be 21 days between the Proxy and the meeting itself.
To summarize, it will be bad news if our Proxy info gets posted soon. This will indicate that it's "business as usual" and that Copper Fox doesn't expect a buyout any time soon (although a back-in is still possible).
Insider Buying/Selling
If the company is in negotiations the insiders will all be blacked out. If we see an insider buy or sell, this will indicate that discussions have terminated.
If Teck is buying us out, we won't need to raise any money. If Teck is backing in, we will need very little money to keep the company running. If we see a financing, it will indicate that Copper Fox doesn't think they will be getting Teck's help for anything. While some might be happy that we will get 100% of the property, I think this is very bad for us.
Drilling Program
As I have mentioned before, it will be a bad thing for us to announce a drilling program unless we know Teck's decision. We don't have any money and the latest PP proved that we are unable to raise any money. Without knowing our financial situation, it will be difficult to determine the size of a drilling program.
Environmental Assessment
Perhaps part of Teck's hesitation to make any decisions is because they want the EAA filed before they make any commitments. All progress on the EAA is shown on this website. The most recent filing is from December. It will be a good thing if we see some new filings because it means that progress is being made on the EAA. Anyone want to place any bets about the EAA being delayed? :)
So it looks like all the silence could be good news for us. Time to sit back and see where things go from here.

I have to agree with many of the points. Put what concerns a number of people is the idea that CUU is deliberately dumbing the news down and not actually following the contract.
This was recently posted by Explorationguy:
Some still insist that the share price doesn't matter, it's just pounds in the ground. Here's a quote out of this article from The Gold 

" Duluth has a contract with Antofagasta Plc (ANTO:LSE), which owns 40% of the joint venture. Once the bankable feasibility study is completed, probably in two years, Antofagasta has the option to buy 25% of the Maturi project for a pro rata share of 1.0x net asset value (NAV), which will be determined by the bankable feasibility study. We've modeled it at a NAV 10% discount rate, $2.80 copper, and we get a value of over $2B for the deposit. That's $500 million ($500M) for the 25%, but Duluth is trading only at a couple of hundred million market cap. If I'm Antofagasta, I'm just going to buy Duluth, and then I get 60% for less than I can buy the 25% for. What I like most is that there's a catalyst that encourages Antofagasta buy Duluth much sooner. My target is $5. "

A couple of points here. One is this deal is 1X NAV and it confirms a point I tried to make on the AG site once. Even if the pounds in the ground was worth $ 10 billion it would be much cheaper for Teck to make a buyout offer for all of CUU shares at say a very generous 60% per cent premium, or about a $ 1.00/share or $ 430 MM. It reinforces the need to get our share price up with the usual methods like starting the 120 day clock, press releases etc.

This post was from the Silicon Investor site. Explorationguy has a point. Every other company out there beats the drum like crazy when they get even the slightest good news to put out but not CUU.

Next, the issue of where are the LIARD shares:

Many of us believe we have earned them but Metacommet cites:

Positive Feasibility Study on the Schaft Creek Project, BC, Canada, Effective date January 23, 2013, 114 days ago, has never been constructively delivered to Teck
Major points of concern
.....65 share price
....failure to invoke contract terms
...misrepresenting acceptance status of undelivered PBFS
...failure to initiate any action to support share price=get Liard shares official start of Teck 120 day review cycle=no relief from Teck claims, ever
...majority holder unable to liquidate due to position size
...majority holder at <0.30 average funding source other than said major holder for any ongoing requirements=single lifeline, when he's done so are we

Seems to me the whole game here is what does EE need

...and at that average, my hunch is he mostly needs to sell em all at once for a lot more than he paid

..the question is what is his "a lot more"

And I theorize the reason for our current, intentional, share price suppression is to keep the price down so that Teck can take EE out within a predetermined limit

...the ethical and legal argument being is it appropriate to ignore the interests of other stakeholders in order to achieve an optimum result for the majority shareholder

He has some valid points. I have tried to get official answers but couldn't get a single line to explain this. Instead, our conversation went along the lines of "why get pushy". Yes, I know we are dealing with a very old set of subclauses going back decades and some of the reporting rules were changed by outside forces.  Yes, our FS builder threw a major wrench in things. But, how about coming out with some statements to clear the air about where we stand?

Looking at how buyers view deposits does it not make sense to clear the air and set the company on the right path by getting the news out?

Both Teck and CUU expect to release news soon. But we've heard "soon" before. I think we should put out a drilling plan. I think we need to indicate where we will take this. A corporate update is appropriate.


  1. Yes, the wait continues.... June 4th comes and passes, will share price fall to lower levels?
    What is your opinion on what is happening right now with CUU and Teck?
    Where is the 2013 drill program!I am curious as to what their strategy and plan of attack will be.
    There is the "untested" East portion of paramount zone, the inferred area, the Mike zone, GK zone, and discovery to drill up. There is so much to do, with great potential to add high grade pounds, and a lot of it. I hope this year its the biggest exploration season in the company's history, hopefully with Teck financing.
    Webgogs, I am interested also in hearing your opinion on drilling and possible outcomes to follow this year.

  2. I expect news next week. I think we should jv this thing unless there's a very good offer. The upside to a jv would be huge. Think about a new resource and having the waste upgraded. WE'RE Calling it a district for a reason. Even though that's been downplayed for now the anomalies are there.

    I'd like to see any of it proved up. It would have been nice to have the drill plan early but that's not in the cards. I think we just have to wait.