Just days after Tempus Resources (TMRR.V, though not for much longer) dropped a middling resource update and ‘big news’ that they were extending the option on a lithium property, CEO Jason Bahnsen has announced not only is he not closing that deal after all, but his company is abandoning the Canadian markets altogether and disappearing to Australia.
THE DETAILS:
In a news release with a headline that could only be described as ‘burying the lede‘, Bahnsen said the company believes a single listing for the Company on the ASX “will better serve investors and investments in the Company” and “instructions will be provided to TSX-V shareholders shortly regarding the process of transferring common shares into CHESS depositary interests, which will enable them to trade on the ASX.” He also announced the Zamora gold and copper projects in Ecuador will be placed on care and maintenance and offered for sale.
The company has shifted from five directors to three, Bahnsen’s salary is being lowered, director fees suspended, and AGM resolutions around incentive options and performance rights rescinded.
North American investors, obviously, are super pissed and the stock dropped to $0.01 post news. I can’t imagine Australian investors will feel any different.
The company continues to hold the rights to the Elizabeth-Blackdome project in Canada, but nobody can see the actions of the last few days as anything but a death rattle. We were told news was coming this week, but this sort of news was not the expectation, coming so soon off the back of the announced shift into lithium, the detail of which still sits in the company’s ‘about Tempus Resources’ blurb on the bottom of the news release announcng the end of the deal.
If I was a charitable man, I’d suggest the company was hoping their resource estimate was going to see them bring in some stock interest and walking around money, which clearly didn’t happen, and figured the lithium kicker might bring in new spectators as a Plan B.
But that lithium deal came with provisos. Tempus was high on the horse when they announced that lithium option a few months back, with Tempus geologists conducting an on-site inspection, examining core samples and initiating a permit request for assay sections. They also underwent analysis of historic drilling, with requests to the Manitoba Geological Survey (MGS) for permission to sample stored core.
If they didn’t get positive answers to those requests, I can see why they’d extend the option a few days while negotiating, and ultimately kill the deal unexpectedly.
If management sees their only option being a full tactical retreat to Australia where they might still have a few friends, and a few bucks, remaining, I can understand why a pair of directors might want to ‘spend more time with their families.’
All of which.. sucks for you.
I reached out to Bahnsen to ask what happened, and heard back, “the results from the Blackdome Elizabeth project were below expectations, so time to hit the reset button.”
I have offered to set an interview to share more information if and when the company wants to talk more.
THE BOTTOM LINE:
Sometimes the best laid plans in the resource world just don’t pan out, and we all make investing decisions with that possibility in mind, but no investor expects their investment will end up on the exchange of another country, especially just days after the announcement of the potential acquisition of a whole new project.
The hate mail has begun, accusing the company of underhandedness, but I have no evidence to indicate this situation arose from incompetence or design. The poor results sometimes happen despite the best efforts and intentions, but I can say that I’m not a fan of the resulting moves to flee.
We’ll repeat, as we always do in situations that don’t pan out on the public markets, that we never tell anyone to buy or sell any stock, regardless of commercial relationships, and that every investment on the markets comes with risk, some known and some unknown. When a client company doesn’t meet with our expectations, we’ll always let you know. This is that. It happens.
But when things don’t pan out, dropping all the news into one release with the sad details of the company delisting buried down-page – that’s a shitty look, bad luck notwithstanding.
With the Ecuadoran projects, Elizabeth-Blackdome, and the lithium move all under the Tempus banner, we figured the $3m market cap was a largely unrisky deal.
As of now, with two of those three assets gone and the other having missed, it’s well over-priced and there’s little left to talk about that isn’t risky. Act accordingly.
— Chris Parry
FULL DISCLOSURE: Tempus Resources is an Equity.Guru marketing client, though I’m not sure what’s left to market.