Newmont has acquired 4000,000 shares in a private placement of Southwestern Resources Corp. (TSX:SWG) at Can$13.00 a share valuing the deal at Can$5.2million.
It's not a lot of money for a company of Newmont's size but is significant for two reason -
It's nearly a 25% premium with Southwestern trading around $10.60
Further proof that for the big boys it's far cheaper to acquire stakes and/or whole companies than it is to spend money on exploration
And no investment in exploration means less precious metals to the market over the coming years.
So which companies are next? And this purchase of Southwestern obviously adds more heat to an already hot market. Look for Goldcorp (GG) to do something next.
With the price of gold/silver still strong the gold/silver sector should be on everyone's radar.
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