Marcel de Groot is Cofounder and President of Pathway. Pathway is a leading private equity fund-of-funds manager for institutional investors worldwide. Pathway’s team of over 100 employees across four offices manages over $25 billion. With an average of more than 20 years of private equity experience among its investment principals, Pathway is one of the most experienced and stable firms in the industry. It should be obvious why I had to spend a little time with Marcel to understand how deals were financed.
Marcel discusses the deal they did with three separate companies. Two years ago they took several small mining companies and the put them together. In October 2016, they formed a company called JDL Gold. This brought them some scale and created additional value.
In March they merged JDL to form Trek Mining. This has given them a near-term production asset with great exploration upside and a well-capitalized company. They then pushed forward and they discussed potential deals with Ross Beaty and NewCastle. This new deal creates even bigger opportunities with even more upside. He says, “It has created a really exciting platform from which to build from.” This combined company called Equinox has made for a very strong management team. Placing these assets together allow them to qualify for indexes, other markets and lowers their cost of capital. The current deal should be complete by January.
This arrangement also protects shareholder interests instead of simply diluting company shares.
Collectively the company now has 5 million ounces measured with more indicated. They are in a really good position to expand their resource base. There is a potential for a ten to fifteen-year mine life with their existing mine and they are fully financed for production.
Talking Points From This Week’s Episode
• Marcel outlines consolidation in the resource business.
• How consolidating companies can build value for shareholders.
• The new company now has much potential and a solid management team.
About Our Guest
Mr. Marcel H. de Groot is President of Pathway Capital Ltd. which he founded in 2004.
He is on the Board of Directors at Asanko Gold, Inc., Trek Mining, Inc. and Equinox Gold Corp. Mr. de Groot was previously employed as an Independent Director by Esperanza Resources Corp., President & Director by Lowell Copper Ltd., President, Chief Executive Officer & Director by Waterloo Resources Ltd., Chairman by Luna Gold Corp., and a Member by The Institute of Chartered Accountants of British Columbia.
He also served on the board at Anthem United, Inc., Premier Royalty, Inc., Sandstorm Metals & Energy Ltd., Underworld Resources, Inc., Ashton Mining of Canada, Inc., JDL Gold Corp., Northern Dynasty Minerals Ltd., Sandstorm Resources Ltd. and Stornoway Diamond Corp. He received his undergraduate degree from the University of British Columbia.