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Take physic, pomp

Pan American Silver (PAAS) plays ‘pimp my balance sheet’

Pan American (PAAS) filed its 1q19 financials tonight. Here’s the balance sheet:
What with…
the purchase of TAHO
the well telegraphed word that they would dispose the Lake Shore end of TAHO (after all, the corporate title isn’t Pan American Gold)
the distinct lack of news on a buyer for the LSG stuff
…I’d been wondering how they would do this. The answer is that they’ve assumed the sale and here’s what it says in the notes about that line item:
Concurrent with the Acquisition, the Company formally initiated an active program to locate a buyer of Lake Shore Gold Inc. (“Lake Shore”), a subsidiary acquired by the Company as part of the Acquisition. Lake Shore’s principal assets are the Bell Creek and Timmins mines (or “Timmins”). Based on management’s assessment of the Company’s sales process it was determined that Lake Shore meets the criteria, under IFRS 5 – Non-current assets held for sale and discontinued operations, to be a discontinued operation to be classified as held for sale upon acquisition. As such, upon the Acquisition and as at March 31, 2019, the assets and liabilities of Lake Shore were classified as assets and liabilities held for sale and are presented separately under current assets and current liabilities, respectively, and the post-tax profit or loss from the Lake Shore operations have been presented as a single and separate item on the Company’s consolidated income statement.
So at first glance the balance sheet looks fine, especially as they took out a $400m revolver to pay off MacArthur’s serial fark-ups and moved all that to a 2023 maturity. But there’s a certain lack of liquidity about that sheet and putting those for sale items on the currents makes the policy both official and to close this year. As for the price and speaking of the worst mining CEO in the business, let us also recall that Ferrari Kev and TAHO paid C$945m for those LSG assets, now about to leave PAAS for around C$500m. That guys knows how to make small fortunes for people. By starting with their large fortunes and…

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