Canada's Royal Nickel turns producer with two acquisitions
Canada's Royal Nickel Corp RNX.TO, capitalizing on discount asset prices as commodity markets swoon, announced two cash and stock acquisitions on Monday that transform the mine developer into a cash-generating nickel, copper and gold producer.
Royal Nickel Chief Executive Mark Selby said the company will acquire a 67 percent stake in Australia's privately-held Salt Lake Mining Pty, in a deal worth C$7.7 million, and 100 percent of Vancouver-based VMS Ventures Inc VMS.V, in a separate transaction worth C$11.4 million.
Salt Lake Mining owns the Beta Hunt Mine, a low-cost nickel and gold mine in Western Australia. VMS's main asset is a 30 percent stake in Reed Mine, a Manitoba copper mine that is 70-percent owned and operated by HudBay Minerals HBM.TO.
"When you're close to cycle lows is the time to be picking up the assets. You never know for sure when you're at the bottom, but I think we're pretty close," Selby said.