Rags to riches: the Klondex story
Headquartered in Reno, Nevada, Klondex Mines Ltd. is a mining company well-positioned to further its two world-class producing mineral properties: the Fire Creek project and the Midas mine and milling facility.
The company, which was recently approved to be listed on the New York Stock Exchange (NYSE MKT), has recently overcome a whirlwind of challenges and milestones, including the extraordinary achievement of acquiring its Midas assets. The story resembles a modern day tale of David and Goliath.
A natural fit
Previously owned by Newmont Mining, the Midas mine was hitting the tail end of its life cycle, from both a human resources and a capital perspective, becoming what’s known as a “non-core asset.”
“The acquisition was a natural fit, because not only would it add another producing mine to our portfolio, but it would also cement a long-term milling solution at Firecreek,” said John Seaberg, Senior Vice President, Investor Relations at Klondex.
But with a single asset at the time, the Fire Creek project in Northern Nevada, with no production and a strained balance sheet, Klondex was in a dire situation. In addition, they faced competition in the Midas transaction.
Newmont had signed a Letter of Intent (LOI) in September 2013 to sell the operation to another company. As part of the deal, both parties agreed the LOI would be terminated by October 14th, unless extended by mutual agreement.
But Klondex President, CEO and Director Paul Huet had a plan to tackle this uphill battle and never gave up. “When the LOI was signed between Newmont and the other company, I never got discourage. In fact, it fueled my motivation and forced me to work even harder,” he said.
Click here to continue reading this story in the December 2015 issue of Business Review USA!