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Kaizen Eyeing South American Copper Assets

Issue 110, January 2015

Kaizen Discovery, a Toronto-listed explorer backed by Itochu and Robert Friedland, is looking to buy copper assets in South America in 2015, chief executive Matthew Hornor tells Global Mining Observer. “A lot of junior mining companies have been creamed, totally destroyed,” Hornor says. “We’re transacting and being active in a very inactive market.”

Kaizen sits on the mainline within Friedland’s group of companies between early-stage project acquisition and the Japanese financial backing that has become a hallmark of his recent deals. Hornor, a Friedland associate who practiced corporate law in Japan, founded Kaizen to roll-up distressed mining assets in the current market rout, in partnership with metal-hungry Japanese groups.

In a string of all-stock deals, the company has been buying-up base metals projects within shipping distance of Japanese ports, including copper projects in British Columbia and New South Wales. In November, it also bought Tundra Copper, securing 4,000 sq km of copper acreage in Canada’s Nunavut for $2.5m in stock.

“That deal in a bull market never would have been available,” Hornor says. “We have Japanese groups keen [to invest] up there and the grades are pretty stellar.”

Kaizen has also been given “the green light” from Japanese groups to “go after” producing assets, Hornor says. “One acquisition doesn’t a trend make, but after we do the fourth or fifth and have all of them financed by Japanese partners, then people might start believing us when I say, this is our strategy and we’re sticking to it.”

Companies Kaizen has approached about an amalgamation are “becoming far less stubborn” when it comes to doing deals, he says. “Nobody is looking at mining right now, which is perfect. Let us keep buying projects, let people give up the keys entirely and head back to the bank, let the whole thing continue. All we can do is make sure we get enough acquisitions under our belt before the whole market turns.”

Shares in Kaizen Discovery last traded at C$0.27.

“Nobody is looking at mining right now, which is perfect.”

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