Monday 24th October 2016

Resource Clips

Juniors under scrutiny

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Another aspect of Zimtu’s work is company creation or reorganization. “We can put together a company’s management team, connect them with an opportunity and then nurture them along. For example, about a year and a half ago we did a gold deal and vended a private company into a capital pool company to create Lakeland Resources [eventually trading under TSXV:LK] in the Ontario gold sector. When that didn’t work out Zimtu stepped back in, kept the original president but reorganized the company with money and expertise to switch its focus to uranium. We were able to add some key personnel and key properties through our connections. As a result, we believe Lakeland’s going to become a significant player in the Athabasca Basin. That’s certainly one of the ways Zimtu helps reduce risk and make it more likely our holdings will be winners in the end.”

Generally speaking, the existing research community doesn’t like to study early-stage companies. Often research doesn’t start until a company is well advanced. But Derek’s research will be very focused on early-stage.—Dave Hodge, president of
Zimtu Capital Corp

Hamill will examine these companies “from the corporate side but also by looking at the market,” he says. “For a company like Lakeland, for example, I’ll be looking at uranium from a macro, long-term concept and looking at the Athabasca Basin in Saskatchewan and why it’s so attractive, as well as looking at the company’s peers in the market.”

He adds, “Clearly I’ll be writing about our own companies, but we won’t be offering price targets or things of that nature. I’ll be telling their stories with more of an analytical background.”

As Hodge emphasizes, “When I tell people about Zimtu Research, I tell them we’re biased. But we have a reason. It’s because we’re shareholders. So the reports should be read from that point of view. We’re upfront about that.”

And by examining these early-stage companies from a shareholder’s point of view, Hodge says Zimtu Research will consider what might be “certainly, as far as the retail audience is concerned, the most important point of view there is.”

Hamill’s inaugural report, Canadian Resource Stocks, Down But Not Out, is available here. Further monthly reports will follow.

Disclaimer: Zimtu Capital Corp and Lakeland Resources Inc are clients of OnPage Media Corp, the publisher of The principals of OnPage Media may hold shares in those companies.

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