During 2016 I observed a little unknown shell company named Mercom Capital raise a relatively small amount of cash before seeing their share price rise from 2.5p to 50p completing a gain of twenty-five times the multiple, In December of 2016, Mercom completed its corporate restructure with directors exiting on favorable terms after returning a bumper win for shareholders. One of these said directors was John Zorbas (CEO at URU Metals) so it came as no surprise to me that the enthusiasm for MCC Spilled over into URU Metals. However, on further review the story became a compelling one given the almost stealth-like nature in which URU Metals had conducted itself given a number of key facts:
- URU Metals spent $8-9m on a PEA for its flagship Zebediela asset in South Africa
- The company has already returned approx $50m via dividends to shareholders historically
- Valuation metrics were materially impacted as mining sentiment in conjunction to a commodity downturn
- Continued belief in their zinc assets, subsequently recording an impressive 570% upgrade in its zinc asset
- Strong base metal assays coupled with encouraging PGE drilling results of approx 2g/t
- Directors aligned to shareholders by taking stock as remuneration instead of a salary
Mr. Zorbas is far from easy to contact as a global jet-setter, so I would like to thank him for taking the time to speak to me here on ValueTheMarkets, the company are admittedly validating the future potential value of its flagship Zeb asset, however, it is completely clear to me the projects are being well managed by proven geologists where senior management pulls together a solid framework which is conducive with a continued bullish commodity landscape of building a ”proper company”.
