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Finished in Canada,Up 16c to C$1.37...AUD$1.55

Tom Meyer,highly rated copper analyst with Canadian broking house,Raymond James,have upgraded their rating to STRONG BUY from OOTPERFORM, increasing target price from C$2.25 toC$2.50

AVM-TSX
Financing Closed and Prospects Improving
Event
We have updated our model to account for the completion of Anvil’s recent
equity financing, which was completed on May‐04‐09.
Action
We are upgrading our rating to STRONG BUY from OUTPERFORM, and
increasing our target price to C$2.50 from C$2.25. We have raised our P/NAV
target multiple to 0.30x (prev. 0.20x) to account for a stronger balance sheet
and improved market conditions. Our NAV/share estimate declines by 23% to
C$8.73 (prev. C$11.41), reflecting the dilution from the equity offering.
Analysis
􀂃 Strengthened balance sheet and liquidity – Anvil issued 30 mln shares at
C$1.15/shr. for gross proceeds of C$34.5 mln. We expect the company to
use the cash to meet its entry premium to Gecamines on the amended
Kinsevere Lease Agreement (US$10 mln is due in Jul‐09, and an additional
US$5 mln by January 2010), and for working capital purposes.
􀂃 Some uncertainty remains – Recall a few months ago that Anvil had cut
all but essential capital spending, leading it to place construction works for
its Kinsevere Stage II project on hold pending funding, and has placed its
Dikulushi mine on care and maintenance to preserve cash (management
estimates savings of US$2 mln per month). Reversing these decisions as
metal prices and financial markets continue to recover would be positive
in our view.
􀂃 Catalysts for the shares – In our view, the key catalyst for the shares is the
potential to secure the needed US$200 mln in funding the remaining
development of Kinsevere Stage II. We note that an important hurdle to
securing the funding, the amendment of the Kinsevere Lease Agreement
with the DRC, has been resolved. The improvement in the copper price
may also prove beneficial for the shares as it may aid the company in
securing funding and also allow potentially an earlier restart of Dikulushi.