{"id":123,"date":"2014-06-13T09:56:44","date_gmt":"2014-06-13T13:56:44","guid":{"rendered":"http:\/\/www.goodwoodfunds.com\/dev\/?p=123"},"modified":"2019-09-01T10:01:20","modified_gmt":"2019-09-01T14:01:20","slug":"peter-puccetti-comments","status":"publish","type":"post","link":"https:\/\/www.goodwoodfunds.com\/index.php\/2014\/06\/13\/peter-puccetti-comments\/","title":{"rendered":"Peter Puccetti comments"},"content":{"rendered":"\n

Dacha Strategic Minerals heads toward wind\u00a0up – Financial Post<\/a><\/p>\n\n\n\n

Dacha \u2013 which started life as a company that bought and owned rare earth metals \u2014 will distribute its Merus shares to its own shareholders on a pro-rata basis<\/h2>\n\n\n\n

Dacha Strategic Minerals Inc., an investment company \u201cwhose objective is to enhance shareholder value over the long run,\u201d is doing what some shareholders wish other companies would do: wind up operations and distribute the proceeds to the owners.<\/p>\n\n\n\n

The latest piece of the drama at Dacha \u2013 which was the subject of a proxy battle at the end of 2012 \u2013 played out this week when it agreed to invest at least $11-million in shares of Merus Labs International. That investment was made as part of a $27.2-million Merus bought deal financing when the \u201cspecialty pharmaceutical company\u201d placed 16 million shares at $1.70 each.<\/p>\n\n\n\n

Once that financing is complete, Dacha \u2013 which started life as a company that bought and owned rare earth metals \u2014 will distribute its Merus shares to its own shareholders on a pro-rata basis. Those shares represent substantially all of Dacha\u2019s assets. After that the company will be wound up and delisted from the TSX-Venture Exchange.<\/p>\n\n\n\n

So what caused Dacha to go into wind-up mode? What happened to the plan of the activist shareholders \u2014 announced in late 2012 at the time of the proxy contest \u2014 to elect a new board \u201cthat will bring an end to the inappropriate related party dealings, culture of insider self-enrichment and inadequate board oversight and direction that has characterized Dacha for the past three years\u2026\u201d?<\/p>\n\n\n\n

Certainly, it tried hard to find value-creating situations. Peter Puccetti, who became the chief executive at Dacha Strategic Metals following the proxy contest, said the company looked at more than 60 possibilities to develop Dacha.<\/p>\n\n\n\n

Of the 60, Mr. Puccetti said that about two thirds represented overtures from private companies, which were looking at a way to go public. \u201cBut something always came up in the due diligence,\u201d said Mr. Puccetti, whose main job is as chief executive at the Goodwood Funds, which focus on special situations value investing. The group\u2019s main fund, the Goodwood Fund has been around since 1996.<\/p>\n\n\n\n

So why not wait a little longer and seek a more conventional way to develop a company? Mr. Puccetti said Merus emerged after having looked at the company for three years. For whatever reason, the two companies \u2013 initially through Goodwood and now through Dacha \u2013 couldn\u2019t structure a transaction until now.<\/p>\n\n\n\n

\u201cWe like Merus,\u201d Mr. Puccetti said Friday when referring to its potential, a potential that can only get better when Merus grows and is able to attract a higher valuation.<\/p>\n\n\n\n

In the past, Mr. Puccetti has participated in more positive outcomes. For instance, while he was at Westaim Corp. (which was spun out of Sherritt International) that company bought Jevco Insurance Co. in February 2010 from Kingsway Financial. In the fall of 2012, Jevco was sold to Intact Financial \u2013 which represented a 55% gain to Westaim\u2019s shareholders.<\/p>\n\n\n\n

In the summer of 2012, following another proxy battle, Mr. Puccetti was named interim chief executive at Longford Energy. At the time, the new board said it intended \u201cto actively review Longford\u2019s prospects and opportunities to best utilize its capital so as to maximize long-term value for shareholders, whether through acquisitions, mergers, other transactions or in some other way.\u201d<\/p>\n\n\n\n

About a year later, Longford\u2019s shareholders had their answer when it merged with Earth Video Camera Inc. Known as UrtheCast, the company \u201cdevelops and publishes a high definition video web platform.\u201d That merger initially worked out fairly well but of late the share price has fallen to levels of nine months back.<\/p>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Dacha Strategic Minerals heads toward wind\u00a0up – Financial Post Dacha \u2013 which started life as a company that bought and owned rare earth metals \u2014 will distribute its Merus shares to its own shareholders on a pro-rata basis Dacha Strategic Minerals Inc., an investment company \u201cwhose objective is to enhance shareholder value over the long …<\/p>\n

Peter Puccetti comments<\/span> Read More »<\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"default","ast-global-header-display":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"default","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","footnotes":""},"categories":[1],"tags":[],"class_list":["post-123","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/www.goodwoodfunds.com\/index.php\/wp-json\/wp\/v2\/posts\/123","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.goodwoodfunds.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.goodwoodfunds.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.goodwoodfunds.com\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.goodwoodfunds.com\/index.php\/wp-json\/wp\/v2\/comments?post=123"}],"version-history":[{"count":2,"href":"https:\/\/www.goodwoodfunds.com\/index.php\/wp-json\/wp\/v2\/posts\/123\/revisions"}],"predecessor-version":[{"id":127,"href":"https:\/\/www.goodwoodfunds.com\/index.php\/wp-json\/wp\/v2\/posts\/123\/revisions\/127"}],"wp:attachment":[{"href":"https:\/\/www.goodwoodfunds.com\/index.php\/wp-json\/wp\/v2\/media?parent=123"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.goodwoodfunds.com\/index.php\/wp-json\/wp\/v2\/categories?post=123"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.goodwoodfunds.com\/index.php\/wp-json\/wp\/v2\/tags?post=123"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}