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The TSX Venture Exchange climbed 14.86 points to 742.29 Friday, ending the week up 58.51 points. Gunther Roehlig's capital pool shell, Yuntone Capital Corp. (YTC: suspended), plans to acquire Mantaro Silver Corp. for the shell's qualifying transaction. The shell will roll back 1 for 2, leaving it with 8,178,535 shares issued, then issue 25,239,000 shares to its target's shareholders.
Mantaro owns five properties in Peru. The main ones are called Santas Gloria and San Jose. Santas Gloria covers 1,100 hectares and has a past-producing mine. The underground workings at the mine need remediation; Mantaro mentions rotten timbers. (Few past-producing mines arrive in good condition, but they can be a well-constructed source of optimism for promoters.) The company must pay $200,000 (U.S.) over the next four months to the unnamed former owner of Santas Gloria. It must also spend $1.5-million (U.S.) on exploration over the next two years. It is now conducting mapping and sampling. On closing of the QT, the resulting issuer will complete a 5,000-metre drill program at Santas Gloria.
The other property, San Jose, covers 3,300 hectares. A small-scale underground mine operated there from 2013 to 2018. It yielded 42,000 tons of ore at 15 to 20 ounces per ton silver. Mantaro must spend $150,000 (U.S.) on exploration at San Jose by 2023. In connection with its going public, Mantaro plans to raise $5-million at 35 cents.
The chairman and chief executive officer of Mantaro is Chris Wilson, a geologist. He previously spent three years as the exploration manager for Mongolia at Ivanhoe Mines Ltd. (IVN: $5.86). He provides geological consulting services through his company, Exploration Alliance SA. On closing of the QT, he will continue as the chairman and CEO of the resulting issuer.
Joining him on the board will be Patrick Hickey, Darren Hazelwood and Charles Hethey. Mr. Hickey lives in Golden, Colo., and previously spent eight years as a petroleum engineer and a manager at Mobil Oil. He later spent 12 years at Newmont Corp. (NGT: $88.94), in positions including engineering manager in Indonesia and general manager in Peru. From 2010 to 2014, Mr. Hickey was the regional vice-president for Africa at Kinross Gold Corp. (K: $11.39). He has since been a mining consultant.
The next director nominee, Mr. Hazelwood, lives near London, England. From 2002 to 2017, he ran a business called Hazelwoods Ltd., a supplier of building materials. These days, he is the CEO of Panther Metals PLC, which has gold properties in Ontario and Australia. Panther trades on the London Stock Exchange and last closed at 11 pence.
The final nominee, Mr. Hethey, is a securities lawyer and a partner at O'Neill Law LLP in Vancouver. He sits on the board of James Hutton's Australian gold explorer, Fosterville South Exploration Ltd. (FSX: $3.31).
Yuntone Capital listed way back in 2009 with a $200,000 initial public offering at 10 cents. It was founded not by Mr. Roehlig but by one-time shell-maker Charles Desjardins, who tried and failed three times to close a QT for the shell. He finally handed it over to Mr. Roehlig in 2018. Mr. Desjardins has been the president since 2002 at Pistol Bay Mining Inc. (PST: $0.035), a North American base metals explorer. This stock traded up to 28 cents in 2006. It has since rolled back four times, equivalent to a single rollback at 1 for 1,000.
Yuntone Capital was suspended in 2016 for not having a transfer agent. It has since remained suspended. In 2017, the shell rolled back 1 for 3 in connection with an Internet QT, but the deal fell through. Considering that rollback, as well as the proposed 1-for-2 rollback in connection with the Mantaro Silver QT, the shell's IPO investors will need 60 cents to break even, assuming they are still around. (A capital pool shell should normally take only two years to close a QT.)
Yuntone's Mr. Roehlig is a long-time promoter. He is the CEO of Zinc One Resources Inc.(Z: $0.01), which last month sold all of its assets and is now essentially a shell. He is also the CEO of another capital pool shell that he did not list himself, the seven-year-old Plymouth Realty Capital Corp. (PH: halted). It is now working on a Mexican silver QT.
Brook Riggins and Neil Johnson's shell, Rozdil Capital Corp. (ROZ: halted), plans to acquireThiogenesis Therapeutics Inc. for the shell's QT. The shell, which has 4.5 million shares issued, will issue 10.9 million shares to its target's shareholders.
Thiogenesis is a California company that is working on drugs for mitochondrial diseases and Rett syndrome (a genetic neurological disease in children). Its lead compound, TTI-1012, is in the preclinical stage. Before the QT can close, Thiogenesis and the shell together must raise $3.5-million at 35 cents.
The CEO and controlling shareholder of Thiogenesis is Dr. Patrice Rioux, who has an MD as well as a PhD in mathematical statistics. He lives in San Diego and will be the chairman of the resulting issuer. From 1975 to 1995, he was a researcher at France's National Institute of Health and Medical Research. He has since worked for at least six pharmaceutical companies, including Raptor Pharmaceutical Corp., where he was the chief medical officer from 2009 to 2014. Raptor is now a part of Horizon Therapeutics PLC (HZNP: $75.47 (U.S.)). Besides Thiogenesis, Dr. Rioux is the chief medical officer of Audacity Therapeutics PBC, which aims to develop "responsibly priced" drugs, including one for multiple sclerosis.
Dr. Rioux co-founded Thiogenesis with Dr. Vincent Stanton, a practising pathologist in Philadelphia. Both men are co-presidents of Thiogenesis. Dr. Stanton was previously the vice-president of research at a Nasdaq-listed pharmaceutical/genetics company, Variagenics Inc. He takes at least some credit for this company's $70-million (U.S.) IPO at $14 (U.S.) in 2000. Two years later, Variagenics was acquired by a private entity at $2.22 (U.S.).
Rozdil Capital listed in July, 2019, with a $215,000 IPO at 10 cents. Its founders are first-time shell-makers. Mr. Riggins was an analyst at Canaccord Capital Inc. from 1997 to 2002. He later spent 2-1/2 years as the chief investment officer of Limetree Capital AG, a private equity firm in Zurich. He now lives in Prague and runs his own financial consulting firm, Beruscha Capital SRO. Over the years, he has held various roles at tech, biotech and medical device companies. For instance, he spent nine months in 2011 as a director of Aurora Solar Technologies Inc. (ACU: $0.20).
His shell-making partner, Mr. Johnson, worked at Canaccord Genuity Inc. from 1993 to 2012. He held positions including European head of investment banking and global head of tech investments. He lives in Toronto and is the CEO of Duke Royalty Ltd., a mining royalty company. Duke trades on the Alternative Investment Market and last closed at 21 pence.
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