Copperbank Resources Corp (CNSX:CBK) has had an interesting period over the past few months. The company’s share price has been on a near 75% decline over this period, falling drastically from about $.12 to $.0373 over the past year.
Furthermore, the past month has then seen their share price decline further from $.065 to their current price, with trading volumes having risen merely in the first few days of August. The peril here, however, is that the trading volumes were accompanied by a massive sell-off of the company’s shares which saw their share price fall further to $.03 from $.048, a further 37.5% decline.
The above cases speak to the major sell-offs which have rocked the company’s shares over the past year, speaking either to the markets dissatisfaction with their operations – their inability to meet their bottom lines – or to the minimal returns which the company has provided over this period.
Eventually, whatever the reason for the above may be, it is clear that we need to review CBK and evaluate what is causing their current situation.
CBK: An Overview
Prior to reviewing the company, let us first have a look at its history.
Copperbank Resources Corp was is set up in 2014, incorporated in Canada and headquartered in Vancouver, British Columbia. It has since then focused on mining and exploration of energy related metal within the United States of America. It has since acquired a number of subsidiaries: Copperbank Resources Alaska Inc, 1016079 B.C. Ltd and Enexco International Inc, each to aid in a particular facet of their exploration business.
Recent Developments in CBK
It has been a while since any information was released by the management at CBK. The company has over the period since May made closed one private placement – which was strategic for their business, appointed a new CEO and made a strategic acquisition.
Capital Raising: Private Placement
Back in May, CBK’s management opted to raise capital through a private placement. The amount targeted was $1 million whereby they issued 15,627,143 shares at a price of $.07, leading to a final raise of $1,093,900 in net proceeds – the company paid no advisory costs for this transaction.
Through this, the management was meant to ensure that they advanced their portfolio projects – which was also achieved through a strategic acquisition discussed later in this piece – as well as ensuring that they met their general operating and working capital needs.
New Chief Executive Officer
Later that month, CBK announced the appointment of Mr. Giulio T. Bonifacio as President, CEO and Director of the company.
According to the announcement, Mr. Bonifacio has over 30 years of experience in the mining field, previously playing a role as the Founder and President of Nevada Copper as well as having played senior executive roles in energy as well as exploration and production companies such as Getty Resources Limited, TOTAL Energold Corp and Vengold Inc. Over this period, he aided in the raising of over $700 million in capital as well as taking part in over $1 billion in transactions.
In his acceptance speech, Mr. Bonifacio stated that:
”I am very excited to join Copperbank and working closely with Gianni and management to advance all ours projects with a focus on Pyramid and Contact which are projects of considerable merit… I am extremely optimistic with our abilities to advance our projects while enhancing the value proposition for all stakeholders.”
With his wealth of experience, Mr. Bonifacio is set to revolutionize the operations and capital raising process at CBK, ensuring that the company is providing the shareholders with as much value as they promised during the capital raising process.
The company eventually opted to acquire Redhawk Resources Inc.
Redhawk Resources Inc is the owner of the Copper Creek Project and therefore presents CBK with the ability to continue in its consolidation mission whereby they are bringing together the copper exploration and mining industry under one umbrella.
The transaction was to be completed with CBK owning about 75% of the shares of Redhawk, leaving the 25% under the previous shareholders. CBK further agreed to offer Redhawk a $200,000 secured bridge loan at 5% interest to cover the costs associated with the transaction.
The Copper Creek has previously been estimated to have around 4.4 billion pounds of copper, a significant amount of the mineral. As such, the option puts CBK with a significant advantage position, ensuring that they can benefit greatly in the case that they reach a significant deposit in the area.
Through this, especially if their gamble pays off, the company expects that they will turn a profit as well as cash flow positive. This was best explained by Mr. Bonifacio who stated:
“Copper Creek’s large land package has not been fully explored with resources open in all directions and several drill ready targets yet to be tested.”
All in all, it is expected that the company is going to benefit in the long term. Their current CEO is expected to bring a lot more to the table, and this seems to be paying off already. It won’t be long before they are smiling their way to the bank.
CBK has had a rough year. Their shares have been plummeting over this period, however, it seems like they have finally opted to change their management and their operations. This is a gamble which we expect to pay off very soon and pay off massively.
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Disclosure: We have no position in CBK and have not been compensated for this article.