Good announcement, the share consolidation might put a few...

Good announcement, the share consolidation might put a few punters off.

http://www.theaustralian.com.au/business/opinion/degrussa-project-lifts-talisman-profile-among-investors/story-e6frg9lo-1225933815533

DeGrussa project lifts Talisman profile among investors
Tim Boreham From: The Australian October 04, 2010 12:24PM THE West Australian junior has won oodles of investor support because of its proximity to the next big thing in copper and gold.

Talisman Mining is positioned near Sandfire Resources's DeGrussa project, widely seen as the beach-head for a new copper region.

The junior today struck another handy deal elsewhere, to sell its handy Wonmunna iron-ore project in the Pilbara for $32.2 million. Strictly speaking, the counter-party, the little known E-Com Multi, has an option to buy the project, which is also wedged on strategic ground near three major projects: Rio Tinto's West Angelas, Rio and Hancock's Hope Downs and BHP Billiton's Mining Area C.

Talisman is 14.7 per cent owned by Kerry Harmanis, who sold Jubilee Mines to Xstrata in 2007 (that is, just at the right time).

E-Com Multi, whose shares price hovers below 1 cent, plans a capital raising of up to $45m and a one- for-25 consolidation. Talisman will also end up with $7.5m of E-Com shares as a result of the sale, so it still has some skin in the Wonmunna game.

Wonmunna is now cited as an 88m-tonne resource, including 10mt of high-grade direct-shipping ore.

Judging from its neighbours, E-com might be getting its paws on a handy asset, but it's only a first step.

Talisman's Springfield project in the Bryah Basin, north of Meekatharra, hopes to emulate Sandfire's massive sulphide (VMS) zone, which assayed bumper grades of 7.13mt (indicated and inferred) 5.2 per cent copper.

Springfield is rated at 10.67mt at 5.6 per cent copper and 1.9gm a tonne gold. We would be quite happy to see Talisman use the cash - which would add to its June 30 balance of $13.6m - to drill some more holes.

Criterion had Talisman as a �spec buy� at 94c on March 30, citing the stock as a low-cap alternative to Sandfire. At the time, we also rated Sandfire (SFR, $7.06) as an �avoid� at $3.58 on valuation grounds, and the stock has doubled since then, which we must confess wasn't in our blueprint.

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The Australian accepts no responsibility for stock recommendations. The author does not hold an interest in any of the stocks mentioned. Readers should contact a licensed financial adviser.