Ellixor Financial Investments

Ellixor - investment picks for microcap stocks.

Tuesday, June 20, 2006

Pioneer Metals Corp (PSM.TO)

"The Board asks shareholders "not to take action" until it evaluates hostile bid from Novagold."

TORONTO, June 20 (Reuters) - Pioneer Metals Corp. (PSM.TO: Quote, Profile, Research) urged shareholders "not to take any action" until its board evaluates a formal hostile bid from fellow Canadian miner NovaGold Resources Inc. (NG.TO: Quote, Profile, Research).
NovaGold, which wants Pioneer so that it can consolidate activities around its Galore creek project in northwestern British Columbia, launched the bid on Monday, offering 57 Canadian cents (51 cents) for every Pioneer share it does not already own.
Pioneer's Grace gold and copper project lies north of NovaGold's gold, silver and copper project.
NovaGold says it owns a 6 percent stake in Pioneer. NovaGold said it would pay out a maximum of C$34.6 million.
The offer is open until July 25.

Pioneer Metals* (PSM : TSX : $0.59)Net Change: 0.16, % Change: 37.21%, Volume: 1,127,079NovaGold Resources (NG : TSX : $12.40)Net Change: -0.55, % Change: -4.25%, Volume: 270,651If you can't beat 'em, buy 'em. NovaGold continues to strengthen its position in the Galore Creek, BC area. Yesterday, Novagold launched a $0.57 per share, all-cash offer for Pioneer Metals. Pioneer owns the Grace property, which is adjacent to Galore Creek and is the subject of litigation. NovaGold also recently agreed to acquire Coast Mountain Power (MW) for $2.20 per share in a move designed to create development synergies in northwest BC. In addition to the Galore Creek area, where a feasibility study is underway and NovaGold hopes to begin mine construction next year, the company continues to advance its Rock Creek and Big Hurrah projects in the Nome, Alaska area towards construction while continuing to develop the Donlin Creek and Ambler projects with partners. Pioneer traded above the offer price throughout the day yesterday, indicating that investors suspect that a higher bid will be required to complete a deal.

Friday, June 09, 2006

BCMetals hits a snag - Accumulate

BCMetals (C.V) Bid $0.70/Ask $0.74

"bcMetals Corp. advises that MiningWatch Canada has filed an application for judicial review of the environmental approvals of the Ministries of Fisheries and Natural Resources. The application claims that the ministries failed to ensure public consultation and/or failed to follow such public consultation. The Red Chris mine has received all necessary environmental approvals from federal and provincial authorities."

A little hiccup for BCMetals provides an opportunity to buy into this play at a reasonable price. Their are several catalyst that could give this stock a bounce back up to $1.50 in the near term (6 to 8 months). See my last published article on this stock.

Saturday, June 03, 2006

Shell Companies

The way to get rich in the stock market is to by low and sell high. Sounds easy, but not many people get it right. However, here is my recommended strategy. Publicly traded shell companies. The way this works is you buy a few publicly traded shell companies. The trick is to look for shells that are controlled by parties that have had success in the past, this is not easy becasue it is not always apparent who is rreally in control of these companies.

Let say we have purchased a shell company, now what? How will the shell's value increase so I get rich? Here is how: Lets say I have a business venture and I want to go public because it is easier to raise money in public markets. This is especially true for resource based exploration and development companies. I essentially role my project into a shell company, the shell company issues me a controlling interest in shares in return. The former shell company no has operations or at least the prospect of future operations or ability to discover a resource, or whatever. In theory, the stock will be in demand by speculators and other high risk players and the price will increase. Those who held the stock prior to the reverse merger will cash out and make money on the stock that they bought for pennies a share.

Note that this strategy is not without risk. The shell may never go anywhere and may even get delisted if the management cannot raise money from time to time to meet the exchanges minimum requirements.

On the plus side, there is a lot of exploration going on for resources and going public using a shell is easy for these private companies looking to go public.

A couple of shells to consider, Lyra Resources Ltd., Previa Resources, Alcor Resources Ltd.