By: Tomas Ronolski - AllPennyStocks.com News

Monday, March 3, 2014

North American stocks are broadly weaker in Monday trading as investors bank profits and put investments on hold in light of escalated tensions between Russia and Ukraine. Some junior miners that were recently intertwined in a takeover battle are advancing, though, as the acquisition takes shape and the outside company starts producing gold. In December, Marlin Gold Mining Ltd. (TSX-Venture:MLN) moved in to top an offer by GoGold Resources Inc. (TSX:GGD) to acquire Animas Resources Ltd. (TSX-Venture:ANI) as both companies sought to take control of Animas’ Santa Gertrudis gold project in Mexico. GoGold came back, offered more in a cash and share deal than Marlin was offering and stroked a definitive agreement with Animas. Marlin took its offer to the shareholders of Animas and eventually let it expire in January.

Today, GoGold said that it was informed by the depositary that a total of 60.19 million shares of Animas, as well as 12.5 million warrants, have been validly tendered to GoGold’s takeover offer. With GoGold buying the shares, it will control 82.8 percent of Animas shares on a fully diluted basis. Shareholders who tendered their stake will receive 7 cents in cash for each ANI share and 0.0851 of a common share of GGD for each shares of ANI, for a deemed price of 15 cents per share of Animas.

The vast majority of the remaining 17.2 percent of ANI shares are held by U.S. residents, which were not available to receive the GoGold offer per U.S. securities regulations. GoGold intends to pursue acquiring these remaining shares and then delist Animas stock from the TSX Venture Exchange.

Shares of ANI are holding at 17 cents in Monday action on understandably negligible volume. Shares of GoGold spiked in early morning trading to $1.75 before cooling to $1.60 for gains of 7.4 percent so far on the day at an 18-month high.

Marlin Gold didn’t waste any time fretting over the failed takeover attempt of Animas. The company said last week that it created Sailfish Royalty Corp as a new subsidiary with the purpose to try and capture the market valuation difference between royalty/streaming companies and operating companies. Sailfish, which is expected to one day be spun-out into a public entity held initially by Marling shareholders, will be entitled to 25 percent of the gold production at Marlin’s La Trinidad mine in Mexico at $1,150 per ounce for the next four decades.

Marlin also penned a binding letter of intent with Golden Reign Resources (TSX-Venture:GRR) regarding its San Albino gold deposit and adjacent areas in Nicaragua. Amongst other details of the deal, Sailfish will have to pay $15 million to be entitled to 40 percent of the gold production at the project at $700 per ounce until Sailfish recovers $19.6 million, at which time it shifts to 20 percent at $700 per ounce.

Marlin and Sailfish have taken the first big step in both of those agreements with the first gold poured at La Trinidad, as reported by Marlin this morning. Marlin put the mine in action quickly and under budget, taking only 13 months after commissioning to bring to production and at a cost of $23 million, versus the $27.9 million outlined in a Preliminary Economic Assessment.

"Construction completion of La Trinidad mine demonstrates that small to medium sized gold mines can be effectively built in a short time frame and at a reasonable cost in jurisdictions such as Mexico," said John Brownlie, chief executive at Marlin Gold, in a prepared statement. He added that the company will focus on meeting projected production as the mine is further developed.

Shareholders of MLN are enjoying hearing the milestone of first production being met. Shares are up 10.7 percent at 16 cents and printed as high as 17 cents in morning action. The stock is easily at 52-week highs and looking to cross 17 cents, a price not hit since late in 2011.

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