Legend Mining (ASX:LEG) is cashed up and fully-funded for a multi-year exploration program in the Fraser Range of Western Australia.
The company recently became one of the most dominant players in the region after acquiring an extensive 2530 square kilometre contiguous tenement package from the Creasy Group.
Legend has cash and liquids of around $12 million at the end of June 2015. Add to this another $6 million cash coming in two tranches of $3 million in September 2015, and December 2016.
With around two billion shares on issue and a last traded price of $0.009, Legend has a market cap of $18 million.
Legend’s project, based on the current share price, therefore has an Enterprise Value of close to zero, but considering the company’s highly prospective tenements and having one of Australia’s most successful prospectors, Mark Creasy, as a strategic investor, the potential of the company is intriguing.
We are joined exclusively by Legend Mining's managing director, Mark Wilson, in Proactive Q&A Sessions™.
PROACTIVE INVESTORS: Welcome Mark.
First of all, how would the acquisition of tenements in the Fraser Range from the Creasy Group re-position Legend?
Mark Wilson: The acquisition places Legend Mining in quite a unique space amongst exploration companies in Australia.
We have cash to explore a highly prospective greenfields opportunity in Australia’s hottest exploration address, which is the Fraser Range in Western Australia.
How far has regulatory approval of the acquisition progressed, and what is the timeline towards a vote being put to shareholders?
Mark Wilson: The Notice Of Meeting including the Independents Experts Report was posted out to shareholders on the 17th August 2015.
The meeting is to be held on the 17th September, and I want to take this opportunity to invite and encourage all shareholders to attend what will be a very good information exchange.
The settlement of the acquisition will then happen five business days following the meeting.
What are the terms of the acquisition, and what will Mark Creasy’s stake become?
Mark Wilson: Mark Creasy will receive from Legend Mining $3 million, which will comprise $2.5 million in cash and the remaining $500,000 in shares.
This will increase Mr Creasy’s stake in the company to 28%, up from the current 25%.
In addition, he will also receive 150 million options $0.04 options, (Legend Mining last traded at $0.009).
Why did Mark Creasy do the deal with Legend?
Mark Wilson: Simply – trust, cash and self-interest.
Trust, in that he trusts the Legend Mining’s team to do the job for him. In regards to cash, we do not need to raise funds in what is currently a very difficult capital market.
And the self-interest aspect. With Legend Mining’s success, Mr Creasy will be the biggest beneficiary due to shareholding in the company, and free carry within the project.
Can you outline the planned exploration programs, including which areas will be targeted first?
Mark Wilson: We are currently reviewing data sets which came with the acquisition, and that review will result in target selections.
Then the target testing is likely to be a combination of ground EM and drilling.
We are hoping, and the great advantage of getting these data sets with the project, is that we can hit the ground running quickly.
Finally, what are the key reasons an investor should consider adding Legend Mining to their portfolio?
Mark Wilson: Legend Mining offers a compelling project in probably Australia’s hottest exploration post code, and the current company valuation, are the keys for investors to evaluate.
With our shares last trading at $0.009, we have a market valuation of $18 million.
We have cash and liquids of around $12 million at the end of June 2015, and $6 million in cash coming from an asset sale.
Therefore the market is currently contributing zero value to the project.
PROACTIVE INVESTORS: Thank-you Mark.
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