For a junior exploration company, adding a valuable piece of property to a portfolio can breed excitement within the company and amongst its investors. For a company that is going through a Change of Business (COB) and kicking off the new business strategies with a significant acquisition, it can definitely get the ball rolling in the right direction.
Vancouver-based AccelRate Power Systems Inc. (TSX-Venture:AXP) is taking the concept to a whole new level. In November 2010, AccelRate announced that it was granted an option to acquire a 70% interest in the Lucky Strike and AU mineral claims from Cloudbreak Resources Ltd. (TSX-Venture:CDB) which are located due west of Kinross’ claims in the Dawson Mining District of the Yukon and collectively known as the "Lucky Strike" property. Upon approval from the TSX Venture Exchange under the terms for a COB, AccelRate will be a pure gold explorer and begin operating under the new name "Goldstrike Resources Ltd."
The COB has not yet been approved by the TSXV, but AccelRate is still surging forward planning for the future as late yesterday a press release hit the wires about an increase in the option acquisitions. As is customary, the acquisitions are subject to TSX-V approval, but the Company announced that it has entered into option agreements entitling it to acquire a 100% interest in thirteen recently staked Yukon gold exploration prospects in Canada's Yukon Territory.
These new projects, many of which have significant proven reserves, comprise a total of 1662 mineral claims over approximately 35,000 hectares which increases AccelRate's options holdings to 1881 Yukon mineral claims totaling nearly 40,000 hectares.
The 13 options are the subjects of thirteen different arm's length agreements entered into with a private staking syndicate. Accordingly, AccelRate has entered into 13 separate agreements in order that it may pursue each of them independently. Each Option entitles AccelRate to acquire a 100% interest in the respective property, subject to a 3% net smelter returns royalty (NSR) and a five-kilometre Area of Interest. The Company retains the right to reduce the NSR by 1% by paying $1,500,000 to the syndicate at any time prior to the ninth anniversary of the Option agreement.
While still waiting for the Venture Exchange to approve all the transactions, investors appear to be on board with the potential AccelRate/Goldstrike Resources option agreement. The share price, which sat stagnant for approximately two months through conclusion of 2010 and the start of 2011, has seen a resurgence since late January which sent the price per share climbing from the area of 20 cents to the area of 70 cents presently.
Technically speaking, the stock will have a challenge forthcoming as resistance stands in front of AXP at 69 cents, which has been tested twice, but not been overcome as of yet. With more news of acquisitions or perhaps approval from the TSX on the changes at hand, investors may continue to turn to the prospects AccelRate and give it the required push. Time will tell.
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