Tuesday, 26 June 2012

Fundamental Research sees Mawson's non-core assets sale as "positive move"

Fundamental Research issued a report on Mawson Resources (TSE:MAW) highlighting the recent divestiture of non-core assets as a signal of future emphasis on its Rompas asset.

"With the removal of these non-core assets from MAW’s portfolio, the company has the ability to focus all of its resources on the Rompas property," Fundamental Research analyst Siddharth Rajeev said in a note.

"This is a positive move towards further development of the Rompas project."
Mawson is a resource acquisition and development company. Its flagship property is Rompas, with sample assays up to 33,200 parts per million gold and 56.6% Uranium oxide.

In March 2012, Mawson completed an agreement with Tournigan Energy - now called European Uranium Resources (CVE:EUU) - whereby European Uranium acquired seven of Mawson’s Uranium projects located in Sweden and Finland.

In return, European Uranium issued 53.6 million shares. European Uranium subsequently consolidated its shares on a 5:1 basis with a number of shares distributed to Mawson shareholders.

Based on European Uranium's share price of $0.09 on the day Mawson announced its plans to transfer the assets, the consideration of 53.6 million shares had an implied value of $5 million.

Mawson also announced the completion of a restructuring campaign in which Mawson was split into two separate companies by incorporating a new subsidiary, Darwin Resources Corp. (CVE:DAR).

"We believe that these agreements will ultimately allow Mawson and Darwin to focus on aggressively exploring and developing the Rompas project in Finland, and the Alto Quemado project in Peru, respectively," Fundamental Research's Rajeev said.

In late May, the company released assay results for the first 14 holes of its 39-hole drill program at Rompas.

So far the drilling has confirmed the size of a greater than 100 metre-wide hydrothermal mineral system. The best result to date is 616.7 grams per tonne gold over 6 metres at hole ROM0011.

"These positive results have increased the importance of securing further drilling permits in order to explore the higher priority targets on the Rompas property."

"We look forward to the remaining results from the spring 2012 drill program," the Fundamental Research analyst said.

Fundamental Research said expansion of the drilling to cover a larger area of the Rompas property is required to advance the project as it will provide a more definitive outline to the mineralized zone.

This may be hampered by the lengthy exploration claims process in Finland.

Mawson currently has $7.50 million in cash, cash equivalents and short-term deposits.

Fundamental Research has not assigned a rating or price target on Mawson Resources "as it is not possible to quantify the potential of Rompas".

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