Shares of the AIM-listed Greatland Gold (GB:GGP) have been having a tough time, with a year-to-date loss of 43%. GGP shares gained some momentum last week following the company’s fundraising efforts and a $475 million deal secured with the U.S.-based mining giant Newmont (NEM). In the last five days, GGP stock has risen nearly 5%. Overall, GGP stock has a Moderate Buy rating on TipRanks with over 100% upside potential.
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Greatland Gold is an exploration company focused on precious and base metals, with projects located in Western Australia.
Greatland Acquires Mines from Newmont
Last week, Greatland agreed to acquire the remaining 70% of the Havieron gold-copper project and 100% of the Telfer mine from Newmont for up to $475 million. The purchase price will be funded through a mix of cash, shares, and deferred payments. With this deal, the company now has full ownership of Havieron and Telfer, which establishes it as a major player in gold and copper production.
The acquisition of Telfer mine is a smart move, considering that gold prices are approaching record levels. Moreover, Telfer is already in operation and is expected to provide crucial cash flow. Meanwhile, Havieron offers a low-cost, long-term growth asset to the company.
Greatland Poised to See Better Prospects
To fund its transactions, Greatland has raised money via institutional placement and a retail offering. Both the offers were oversubscribed, indicating strong investor confidence. Shareholders could be hoping that this marks the end of a series of fundraising efforts that have impacted Greatland’s share price in recent years.
Additionally, the deals are further expected to leverage existing infrastructure to enhance development and lower capital costs for the company.
Is Greatland Gold a Good Stock to Buy?
According to TipRanks’ analyst consensus, GGP stock has received one Buy recommendation from analyst Richard Hatch from Berenberg Bank. He predicts a growth rate of 120% at a share price target of 12p.
