New brokers, new advisors, new money.
And potentially a new direction too.
Towards the end of October, Europa Metals Ltd (AIM:EUZ, JSE:EUZ, OTC:EOPAF) raised £1.5mln in new money.
The plan, as stated, is to deploy that money in the furtherance of new deals, including the securing of a potential partner for the development of the company’s Toral polymetallic project in Spain, but also for potential acquisitions.
New broker WH Ireland and new advisor Bennelong Corporate helped Europa bring in the money, and while the arrival of Ireland is unlikely to get anyone’s pulses racing, Bennelong’s involvement just might.
Because Bennelong is one of the driving forces behind Alien Metals, a company that not many people took too seriously until its share price suddenly ballooned on the strength of some very real assets that turned out to be only too promising.
One of the key aspects of Alien’s trajectory which initially wrong-footed the market was its ability to do unexpected deals that were nonetheless accretive. Thus, at a time when both the iron ore and the silver price was roaring away, guess who was one of the only companies to have both in its portfolio? – That’s right. Alien.
These days, Alien’s got plenty on its plate, but could there be an opportunity to replicate that success with Europa?
It’s not beyond the bounds of credibility.
After all, Toral already boasts an overall resource of 20mln tonnes of ore and counting, and is plenty good enough to serve as a cornerstone asset around which to build a larger and more dynamic portfolio.
Bennelong can help with that, and it’s notable too that Alien and Europa share a director in Dan Smith.
So what will happen next?
First, the fundraising, or at least part of it, needs to be ratified at the company’s upcoming annual meeting on 30 November. There, shareholders will get to have their say on recent developments and the broadening out of the company’s strategy.
But if Bennelong can bring new deals to the table and enable Europa to perform in a manner similar to Alien, then gripes are likely to be few and far between.
After all, the turnaround that the current team at Alien managed to effect when they took it over resulted in a return of upwards of 15 times for some investors.
One of Europa’s biggest investors, Deutsche Balaton, recently upped its stake from 11% to 15%, so clearly there’s a degree of optimism amongst major shareholders.
Either way, the early signs are that the market is waking up to Europa.
In the meantime, grant money from the Spanish government continues to come in, as community relations and geological research are marrying up nicely at Toral.
So, there’s much to be positive about. This is a cash-rich company with a cornerstone asset that’s moving forward, a newfound desire to do deals, and the advisors to help them do it.
This time next year, Europa could look a very different animal.