Shares in Semafo (SMF-T) jumped 10, or 7.5%, to $1.43 in Toronto on May 27, on news that its Moroccan-based majority shareholder Managem is looking at options for its 52% stake in the Montreal-based junior.
Semafo says that its parent company has advised it that it has hired Rothschild as its financial advisor in connection with “seeking and reviewing alternatives to its investment in Semafo.”
”Managem’s review of alternatives may include the consideration of a number of transactions. There can be no assurance that any transaction will be entered into or completed as a result of this process, nor the timing thereof,” Semafo said in a prepared statement.
Managem is the mining subsidiary of Moroccan industrial conglomerate Groupe ONA. The company provided project management during construction of the Samira Hill gold mine in Niger.
Samira Hill is owned by Nigerien-based La Socit des Mines du Liptako, which, in turn, is held 80-20 by African GeoMin Mining Development (AGMD) and the government of Niger. Semafo and Etruscan Resources (EET-T) each have a 50% participating interest in AGMD.
Semafo lost US$821,000 (or 1 per share) during the recent first quarter, compared with earnings of US$3.9 million (4 per share) during the corresponding period of 2004. The year-earlier results include a US$5.45-million gain on the sale of some subsidiaries.
Gold sales during the latest first quarter quadrupled to US$12.6 million, with 36,926 oz. sold at an average price of US$341 apiece. The increase is attributed to the start up of the Samira Hill mine in October of 2004.
First-quarter total gold production came in at a record 39,958 oz. at a cash operating cost of US$232 per oz.; the Kiniero mine in Guinea chipped in with record production of 16,821 oz.
Semafo currently has nearly 90.4 million shares outstanding.