The Globe and Mail reports in its Tuesday, March 12, edition that Canaccord Genuity analyst Dalton Baretto raised his rating for Imperial Metals following its $806-million sale of 70 per cent of its Red Chris mine in British Columbia to Newcrest Mining on the weekend, believing its financial concerns "have been fully addressed" (all figures U.S. unless otherwise stated).
The Globe's David Leeder writes that Mr. Baretto says in a note: "We view this transaction as a very good deal for III. The $806.5-million price paid for 70 per cent of Red Chris implies a total value of $1.54-billion for the asset; this implied value represents a 24-per-cent premium to our carrying value of $1.24-billion. Our overall NAV for III has increased by 33 per cent, to $4.75 per share (from $3.20 previously).
NCM is a very strong operator, and we believe that this deal will surface further value from Red Chris, both in the near term as well as in the long term. NCM's financial and operating capabilities now provide a clear line of sight to production from the very large resource at Red Chris."
Moving Imperial to "buy" from "hold," Mr. Baretto increased his share target to $4 (Canadian) from $1.65 (Canadian).
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