THE RISE OF CORONA

The Corona Corp. of today is the Tcreation of two very different people : Murray Pezim, Canada’s best-known and most flamboyant promoter, and Ned Goodman, a financier with practically no public profile but who is regarded by many to be as visionary as American Barrick’s Peter Munk. Pezim, who patterns his assaults on hot exploration areas after Joe Hirschorn’s pre-emptive strike on the Elliot Lake uranium field, took International Corona (as the company was called until last year) from its origins as just another penny junior trading on the Vancouver Stock Exchange to its exalted status as premier mine-finder. International Corona spearheaded the Hemlo discoveries. But Pezim’s promotional instincts overwhelmed his managerial talents. He lost control of his beloved Corona, his “baby” as he called it. A series of ill-conceived investments (Swenson’s Ice Cream Parlours, Pezzazz “Greetings from the Stars”) and plain bad luck killed the dream, and control of Corona slowly slipped through his fingers. The Corona Corp. of today, a conservatively managed, pin-striped gold producer, traces its real roots back to a Jan. 31, 1984, transaction between Royex Sturgex Corp. (later to become Royex Mining) and International Corona. Up until then, International Corona was firmly held by Pezim. But on that winter’s day, Royex, with Goodman as a director, acquired 900,000 common shares of International Corona, 850,000 Corona warrants and a $6.5-million debenture. In addition, the agreement stipulated that the new 8-member Corona board consist of four nominees picked by Pezim and four by Royex. International Corona sought the deal to fund development costs for the David Bell mine and continue its court action against lac Minerals over the Williams property at Hemlo. (Up to now, Corona and its predecessor company have won all the battles in court over the Williams mine. A ruling by the Supreme Court of Canada is pending.) Pezim, through Pezamerica, later picked up another big block of Corona shares. But in October, 1984, the Vancouver Stock Exchange crashed. An over-margined Pezim was short of cash. So he sold to Royex 1.4-million Pezamerica shares (Pezim’s International Corona shares were held through Pezamerica) and became honorary chairman and a paid consulta nt of International Corona. Royex wound up as controlling shareholder of International Corona.

The guiding light behind all the moves at Royex was Goodman, a founding partner of Beutel, Goodman & Co., an investment counselling firm and mutual fund manager. He was also chairman of Campbell Resources at the time. The financier believed in gold when Royex, with its International Corona holding, was still in the Campbell fold. Campbell was losing money at the time and had to beat the bushes for cash. Goodman split with the Campbell board when it chose to sell Royex and, with it, the Corona stake. Goodman saw the potential of Corona’s David Bell mine and, perhaps, the lawsuit with lac. He also saw that South Africa’s problems were not going to evaporate and that a major, North American gold producer with stable production would be just the ticket for investors seeking South African divestment. A believer in gold, he recently told The Northern Miner Magazine that “if you look through history, you’ll see that it’s the only currency with any lasting value.” Goodman made it possible for International Corona to pick up the Royex stake by having International Corona acquire a 100% interest in New Ventures Equities, a venture capital pool set up by Beutel, Goodman in the late 1960s.

While there was private manoeuvring between Pezim and International Corona’s newer shareholders, an open rift didn’t surface until 1987. Early that year, it exploded in the financial press. Pezim accused Goodman of “nefarious” doings to gain control of International Corona. He vowed to take control himself. Threatened legal actions, however, came to naught, and finally by May, 1987, everybody involved seemed rather buddy buddy. And so they were, and are to this day. Pezim says he is happy in his role as honorary chairman of the amalgamated Corona and head of Prime Capital Corp. Of the feud that eventually cost him control of Corona, he told The Northern Miner Magazine that “it’s the best thing that ever happened to me. I’m a damn good promoter and I’m a damn good entrepreneur, but I sure can’t run a mining company. Peter (Steen, Corona’s chief executive and president) knows how, and Ned, well Ned is just brilliant.”

Since 1987, the tangled inter- corporate holdings among International Corona, Royex, Mascot Gold Mines and Lacana Mining Corp. have been smoothed out. Corona Corp. is the surviving company with partial or 100% interests in eight gold mines (nine if the disputed Williams mine is included in the fold), an industrial minerals division and a controlling shareholding in Poco Petroleums. The diversification is a deliberate strategy to buffer Corona against weak gold markets — should that happen.

Says Goodman: “We do want diversification. I’ve lived through the bad times in mining and at those times you want a few extra chairs to sit on.”