NOT A PROMOTION OR ADVICE TO INVEST:
I saw this interview by David Morgan of James M. McDonald, CEO of Kootenay Silver yesterday:
and now this article on Seeking Alpha which mentions Kootenay:
http://seekingalpha.com/article/3911016-mining-capital-expenditure-continues-fall-cycle-expected-another-2-years
The reason I bring it up is that it makes me think of Masglas (AMC’s parent company). Essentially their self-description value-add is as a ‘consolidator’ for the majors. They find, consolidate, explore properties, get to formal resources and then sell in part or whole. They just did a deal with subsidiary of Pan American Silver (a silver major) with a “purchase Option” for Kootenay’s flagship property: 75% ownership for $8M in cash and $8M in exploration expenses. Their idea is to do the work now and then turn about and sell when the majors must buy as the market turns and they need to replenish reserves.
It sounds quite familiar.
In this mental model AMC is one subsidiary of the parent and the ADL is the flagship property being consolidated along with other properties Masglas has already publicly mentioned.
The cash from early production enables them to 1. pay the ADL option, 2. fund exploration and increase value of the property, 3. potentially fund further Masglas acquisition and exploration and thus expand their consolidator role and increase value in their company.
In this model, Masglas is the company that would go public like Kootenay. And Maurizio Cordova is James M. McDonald.
Medinah US would own 100% of MMC which would own 15% of AMC with the other 85% owned by Masglas (and friends) (15 / 85 ratio subject to change but the idea is what is important here). Medinah would have no direct relationship with Masglas other than as shareholders in the same company (AMC).