PAN AMERICAN SILVER (PAASF) CVR, mcap=$4.3bn, price $0.68 vs $0.70

Pitch:
– Pan American Silver CVR that pays out when Escobal silver mine in Guatemala re-opens.
– 47% spread + additional upside from $PAAS appreciation.
– The 2nd largest silver mine in the world and one of the key PAAS assets.
– The mine reopening seems very likely and just needs to pass certain bureaucratic steps in consultations with minority indigenous local populations.
– In a change of control scenario, CVR pays out instantly irrespective of the Escobal mine outcome.

Valuation:
– PAASF CVR trades at 47% spread to $PAAS value.
– In the scenario of Escobal re-opening PAAS expected to trade up(+25%) and the CVR spread to close yielding an 85% return on CVR.

Exp. gain: +86%.

Full $PAASF write-up (free guest account required):
https://www.valueinvestorsclub.com/idea/Pan_American_Silver_CVR/4324310800

 

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