Focus Gold Corporation’s (OTCQB: FGLD) FGLD -7.00% on 4th October, 2011 highlighted the latest transaction of the Porphyry gold project in Mexico.
The Management of the Company feels that the Porphyry gold project is related to the Huicicila Porphyry Gold project located in the state of Nayarit, Mexico.
With the demand for Porphyry projects booming, there has been an outbreak of Mergers & Acquisitions in the sector, the newest transaction being Agnico-Eagle’s ($13.5 Billion enterprise value) friendly takeover of Grayd Resources for roughly $275,000,000 (or about $275/Oz resource). So far this is one of the highest valuations paid for a Porphyry project in Mexico, especially for a non-proven reserve. Agnico-Eagle Mines Limited acquired Grayd Resource Corporation for $2.80 per share by way of a take-over bid.
Along with an acute interest in La India Porphyry gold project situated in the Mulatos Gold Belt of Sonora, Grayd has off late discovered the potential gold porphyry of Tarachi located approximately 10 kilometers north of the La India project. Both projects are located in a large package of exploration concessions that total approximately 54,000 hectares. Grayd’s properties lie at the opposite end of the same chain of mountains, the Sierra Madre Occidental, as Focus Gold Corp’s Nayarit project.
Grant R. White, CEO of Focus Gold Corp., commented, “It is no secret Porphyry gold deposits are in strong demand by the majors. Grayd developed a 1 million ounce resource in about 4 years, and in the process, took the stock from $0.25 to the take-out price of $2.80, a 1,000% return for Shareholders. In our opinion, our Nayarit project has multi million ounce potential if developed and explored properly. The facts are these types of projects are in large demand and for Grayd’s project to be acquired for over $275/Oz only based on a resource and not a reserve speaks volumes for the valuation potential of our Nayarit project. Ubika’s June 6th research report on Focus also highlighted the significant value of Porphyry systems.
Shares of FGLD slid 15% in past one week.
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