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First Mining Finance Update: Gold Canyon Resources Arbitrage (November 09, 2015)

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Screen Shot 2015-11-09 at 9.59.51 AM

It looks like we are getting closer to the finish line — shareholders of Gold Canyon Resource (GDCRF/GCU.V) almost unanimously approved of the merger with First Mining Finance (FFMGF/FF.V).

From First Mining Finance:

Of the votes cast by Gold Canyon shareholders at the Gold Canyon meeting, 99.2% were voted in favour of the special resolution approving the Gold Canyon Arrangement (99.17% after excluding the votes required to be excluded pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions for the purposes of determining minority approval for the Gold Canyon Arrangement)

Further, First Mining Finance also received 99.77% shareholder approval to consolidate with PC Gold. Both deals are expected to be finalized by the end of this week:

Each of Gold Canyon and PC Gold will be seeking final court approval of their respective Arrangements on November 10, 2015 and, subject to the satisfaction of certain customary closing conditions, the Arrangements are anticipated to be completed on or about November 13, 2015


As a shareholder of 70,000 shares of GDCRF and 30,000 shares of GCU.V, this is of course wonderful news.

I am looking forward to having my 100,000 shares of Gold Canyon converted into First Mining Finance very soon. Upon announcement of the news, shares of FF.V are down 7.50% this morning, trading at C$0.370/share. GCU.V is down 4.17%, trading at C$0.345/share.

Shares are probably down because of the impending dilution… But in the case with First Mining Finance, their business model has always been to issue paper to expand the company; they prefer to look at these deals as growth through accretion, not dilution.

When you are buying up quality assets at the bottom of a business cycle, I am very much inclined to agree!

Looks like the arb opportunity is still there? About 7% or so… At one point in time, the arb was as wide as 30%

It appears to be a near slam-dunk now… But as I’ve learned in the past, never count your chickens until they hatch!

But seriously, who doesn’t want to support a CEO like Keith Neumeyer who puts his money where his mouth is?

From Canadian Insider:

Screen Shot 2015-11-09 at 10.23.58 AM


As an investor, you’ve gotta LOVE IT when management believes soooooo much in their own company!


Nevertheless, this is some good news to start the week with! 🙂


Happy Hunting!


Photo Credit: First Mining Finance

{ 6 comments… add one }
  • Income SurferNo Gravatar November 9, 2015, 5:23 pm

    I give a lot of credence to insider buys as well Fighter! Just remember there may well be plenty of pain between now and profits….in our commodity investments. IF the Fed actually raises rates, the dollar will strengthen and our investments will be under pressure. It’s a big if, but still. I’ll be adding to my Ag commodities ETF in the next few days. Happy Hunting buddy

    • FI FighterNo Gravatar November 10, 2015, 10:11 am


      Yup, that’s definitely a possibility. Combine an interest rate hike with tax-loss harvesting and the worst may still be on the horizon.

      I’ll keep adding when I see attractive deals, but it’s a great idea to keep some powder dry as we gear towards the end of this year.

      All the best!

  • JonNo Gravatar November 10, 2015, 2:28 am

    It’s worth remembering that the last two times the fed has started a rate hike cycle, the price of gold has increased 10% in the following 12 months. May be a case of buy the rumour, sell the fact?

    • FI FighterNo Gravatar November 10, 2015, 10:12 am


      That’s interesting to know — thanks for sharing that bit.

      Yeah, I definitely can’t say I know what will happen, so I’m just gonna do the best that I can and add positions at attractive valuations. I’ll keep some cash on the sidelines as well, but if I see a good deal (and there are plenty right now), I’m going to jump on them.

      Take care!

  • delivery boyNo Gravatar November 12, 2015, 2:27 pm

    How is this strategy working out for you? I tend to be a contrarian like you but the strength of the dollar and global slowdown is real and scary to this strategy.

  • Common Reporting StandardNo Gravatar November 16, 2015, 11:46 pm

    Good luck to that 100 shares.

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