Erik Wetterling, Founder and Editor of The Hedgeless Horseman website, joins me to review his key takeaways from the Precious Metals Summit in Beaver Creek, and the best opportunities he sees presenting themselves in the resource sector.  Additionally, we get to hear Erik’s reaction to the news that broke this Monday reporting on the merger of First Nordic Metals with Mawson Finland, to produce a larger Scandinavian exploration and development vehicle.

Coming into the PM Summit in Beaver Creek, gold, silver, and the precious metals stocks were continuing to make new highs, giving a much improved sentiment to the conference as the bull market raged on. We also got into the nuances of how one may need to adjust company valuations in a dynamic way based on how their newsflow compliments or is at odds with the underlying macro conditions and gold and silver price action.

Erik points out that many of the PM producers and developers, that looked grossly undervalued a year ago and seemed to be ignoring the surging metals prices, are now finally up multiple-fold.  Even the optionality “beta” plays, with sunk costs and banked success via ounces in the ground, have continued to rerate higher at this point; making them less attractive from his vantage point.   In contrast, many of the exploration stocks have only started to move recently, and some explorers or early-stage discovery stocks haven’t even moved that much in contrast to the rest of the sector. Erik remains more encouraged by these “alpha” plays, that have clear catalysts on the horizons from their ongoing work programs.

We then shifted over to the news that broke early this week on September 15th, announcing the merger of First Nordic Metals Corp. (TSXV: FNM) (FNSE: FNMC SDB) (OTCQX: FNMCF) (FSE: HEG0) and Mawson Finland Limited ("Mawson") (TSXV: MFL) (FSE: PM6).   Erik unpacks the synergies that he sees in this transaction between the 2 companies, the value proposition of their combined projects, management teams, and board of directors, and how this may provide a better cost of capital, more liquidity, and the ability to negotiate with Agnico Eagle from more of a position of strength.

This transaction will consolidate a large and prospective gold development and exploration portfolio in Sweden and Finland, including First Nordic's Barsele Joint Venture Project and Gold Line Belt projects in northern Sweden and Oijärvi Project in northern Finland, and Mawson's Rajapalot Project and surrounding Rompas-Rajapalot Property in northern Finland.

Click here to follow Erik’s analysis over at The Hedgeless Horseman website

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