Ethiopian Potash Corp. (CVE:FED) is tanking after the stock opened with a massive premium as IIROC lifted the trading halt.Trading of FED, formerly Panorama Resources Ltd., was halted since October 2010. The company underwent drastic changes resulting from a reverse takeover and amalgamation between EPC and Panorama Resources. Panorama’s stock will be delisted from the exchange altogether.
No other major changes were announced. FED rolled down 8% on Monday and remains at 2.7 times the pre-merger level. Trading activity decreased significantly on the second day of trading, but still beats the average.
Prior to the takeover, Panorama had little business activities and held on to its single property at Ketchum Lake in northwestern British Columbia. The business retained considerably small losses ($167k for nine months ended June 30, 2010), as well as little working capital ($282k reported for June, 2010).
Shareholders of both the private Ethiopian Potash and the public Panorama approved this amalgamation in a meeting held on January 28, 2011. Following the approval from the exchange and the regulators, the new entity became a subject to receive $11 million worth of subscription receipts, convertible into units of common shares and warrants at 50 cents per piece.
