Last week, the Gregory Brothers filed an early warning report on SEDAR after entering into an agreement with Select Sands (SNS.V) to purchase its 20 million shares of Comstock Metals (CSL.V) at a fixed price of C$0.1475 per share. As the several companies in the Gregory conglomerate already owned 13,999,999 shares, the acquisition would push the total position in Comstock Metals to 46%. On top of that, if all warrants would be exercised, the companies associated with the Gregory Brothers would become the majority shareholder by owning in excess of 60% of the company.
Comstock Metals is reviewing the situation as it would have to accept at least one director to its board of directors, and we expect to see more details shortly. It will also be interesting to see if the new main shareholder is willing to participate in Comstock’s future financings to keep its position at 46%. If that’s the case, Comstock will always have a lead order, backstopping at least 46% of the financing.