IC Potash Corp.

IC Potash Corp. has demonstrated a low-cost method for producing potassium sulfate, also known as sulphate of potash or SOP, from its 100%-owned Ochoa polyhalite deposit in southeastern New Mexico. SOP is the preferred potassium fertilizer for high-value crops—fruits, vegetables, coffee beans, nuts, potatoes and tobacco—and for use in soils that are salty, sandy or located in arid regions. The company has concluded an independent feasibility study that recommends it move forward to implementation, and has received a Record of Decision from the Bureau of Land Management that authorizes construction and operation of the mine and mill.

Expert Comments:

"The money IC Potash Corp. raised from Cartesian will be used for general corporate purposes and, to a lesser degree, to advance the Ochoa project. The value was not so much in the amount raised (they will need $1B+ to fully fund the project), but in the nature of the investment and the implied public company valuation. Cartesian invested at the project level, marking the first time we've seen a junior in the space get financing in this manner. All the other strategic investments came at the public company level and were generally highly dilutive and, in some cases, came with warrants. The 7.8% interest Cartesian could own of the project implies a project value of $130M against the market cap at the time of ~$40M. Had IC Potash raised $10M at the public company level (priced at $0.24/share, the previous close) Cartesian would have owned ~20% of the company and project. Hence, IC Potash effectively raised $10M at the public company level priced at about $0.75/share, or a 200% premium. We believe IC Potash is Cartesian's first junior resource, non-operating company investment, which speaks to the strategic value of the project. In addition, given the relatively small size of the investment (for Cartesian), we would expect it should be a further source of funds going forward." read more >

Stockhouse (12/17/14)
"IC Potash Corp. recently took a big step toward its goal of becoming a leading low cost producer of potassium sulphate by securing a US$10M injection from Cartesian Capital Group. . .an NI-43-101-compliant technical report concluded that the Ochoa property contains significant polyhalite mineralization in quantities and grades that are expected to be attractive for mining and processing under current market conditions."

Daniel Gleeson, Mining Journal (12/2/14)
"Premiums sulphate of potash (SOP) producers are achieving are showing no signs of abating. . .there are a handful of companies scheduled to bring projects online in the next few years, which could fill some of the demand expected to come from emerging markets in the long term. . .the list of projects includes IC Potash Corp.'s Ochoa asset in New Mexico."

John Chu, Alta Corp Capital (11/27/14)
"Cartesian Capital Group, LLC has made a strategic investment in IC Potash Corp. by purchasing 500K Class A preferred shares for $10M. The preferred shares accrue value through deferred dividends at an annual rate of 12% for two years. . .then may be converted into 7.8% of the outstanding common shares of the company, or may be redeemed at the option of Cartesian. . .IC Potash has now secured the financial means to get to the next step of the development process. . .we are upgrading to Outperform due to our 57% rate of return."

Spencer Churchill, Paradigm Capital (11/27/14)
"IC Potash Corp. announced a $10M strategic investment by Cartesian Capital Group, LLC. . .implying a financing at the public company at a 300% premium. . .the first time we have seen a junior in the space receive strategic financing at the project level. . .implies a project value of $130M against the current market cap of $45M. Had IC Potash raised this $10M at the public company level. . .Cartesian would own 20%. . .IC Potash is Cartesian's first junior resource, non-operating company, which speaks to the strategic value. . .Cartesian could be a further source of funds. . .we are impressed with IC Potash's ability to access capital in a tough market for juniors, with little dilution."

Alessandro Bruno, Investor Intel (11/5/14)
"IC Potash Corp. is well positioned to lead a market of about 5.5 Mt/year as one of top and lowest-cost sulfate of potash (SOP) manufacturers in the world. . .the company is developing the only new SOP potash in the world and is marked by the lowest capex and opex, as well. The projected opex rate per ton of production at Ochoa is about $150/ton, which is about 65–70% less than the industry average of $500–550/ton."

More Comments

Experts Commenting on This Company


The information provided above is from analysts, newsletters and other contributors. Please contact the company and visit its website before making an investment decision.
Investing Highlights
 
Global demand for SOP exceeds supply
 
Projected to be world's lowest cost SOP producer
 
Federal and state approvals in place for construction and operation
IC Potash Corp. Content