This report highlights Canada-listed stocks that are potential takeover targets, trading at a discount to their cash balances
SmallCapPower | November 14, 2017: As seen in the past, businesses with more cash than equity value are sometimes attractive takeover targets, so today we highlight four Canada-listed stocks that have cash balances greater than their market caps.
Minco Silver Corp. (TSX:MSV) – $0.69
Metals & Mining
Minco Silver Corporation is a Vancouver-based development stage company focused on advancing its Fuwan Silver Project in China. The Fuwan Project (silver, lead, zinc) is located 45 kilometers south west of Guangzhou, in SE China. The property comprises 172.5 square kilometers and has easy access to a highway, power lines and water.
- Market Cap: $42 Million
- Cash and Short-Term Investments (Last Reported): $49 Million
- 1 Month Total Return: -19.8%
Velan Inc. (TSX:VLN) – $18.50
Machinery
Founded in 1950, Velan manufactures industrial valves for the energy, oil & gas, chemicals, mining and pharmaceutical sectors. The Company is based in Montreal and has over 1,800 employees working in 14 production facilities across the globe.
- Market Cap: $112 Million
- Cash and Short-Term Investments (Last Reported): $117 Million
- 1 Month Total Return: 3.9%
Sprott Resource Holdings Inc. (TSX:SRHI) – $0.14
Metals & Mining
Sprott Resource Holdings (SRHI) is a Canada-based company focused on investments in the natural resource industry. SRHI has interests in a variety of resource companies including Minera Tres Valles; a Chilean copper producer and Corsa Coal Corp; a supplier of metallurgical coal. Although Sprott does not trade below its cash balance, the Company has producing assets and its market capitalization is only marginally higher than its cash balance.
- Market Cap: $95 Million
- Cash and Short-Term Investments (Last Reported): $76 Million
- 1 Month Total Return: -3.4%
Concordia International Corp. (TSX:CXR) – $0.68
Pharmaceuticals
Concordia International is a Canada-based pharmaceutical company that sells its product in more than 90 countries. The Company owns a portfolio of more than 200 pharmaceutical products that includes, Donnatal and Photofrin. Concordia operates out of facilities in Oakville, Ontario; Bridgetown, Barbados; London, England and Mumbai, India.
- Market Cap: $34 Million
- Cash and Short-Term Investments (Last Reported): $383 Million
- 1 Month Total Return: -54.7%
Disclosure: Neither the author nor any of the principals at SmallCapPower, or their family members, own units in any of the companies mentioned above.
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