Rob McEwen, Founder of Goldcorp and Founder and CEO of McEwen Mining (TSX: MUX)
We met with Rob McEwen, founder of Goldcorp, and founder and CEO of McEwen Mining (TSX: MUX) during the PDAC Conference in Toronto. We talked about McEwen Mining and some of his other ventures on the forefront of medical science.
In the early 1990's, Mr. McEwen left the investment world, founded Goldcorp, and gathered a few other small exploration companies together. Over the years, Goldcorp grew and grew, earning a spot in the upper echelon of gold companies worldwide. (Currently, it's the second largest gold company in the world, by market cap). While at Goldcorp, he grew the company from a $50 million to $8 billion market cap.
Mr. McEwen founded McEwen Mining (TSX: MUX) in 2012. Similar to his work at Goldcorp, Mr. McEwen created McEwen Mining by finding other small companies and leveraging their strengths to create a new, better company. In this case, Mr. McEwen envisioned that US Gold Corp and Minera Andes, in which he had large investments, would be a good fit to form a new synergetic larger, higher-potential mining company. He said: "US Gold had a very good pipeline for growth but it didn't have an income stream, and Minera Andes was producing gold and silver from a mine in Argentina. So by combining the two, you have income and cash flow and production growth and a very good platform for building to the next stage."
Merging these two companies into one, Mr. McEwen now has a company with projects in Nevada, Northwest Mexico, Argentina and Alaska,
His success at Goldcorp is an indication that Mr. McEwen is on his way to create another massive mining interest. McEwen Mining is built with one very specific goal in mind. Mr. McEwen explained: "McEwen Mining's goal is to qualify for the S&P 500 in 2015. There's only one gold stock in the S&P 500 right now and I think the index is under-represented by precious metals stocks. So we are going to build McEwen Mining into America's next big precious metals company."
Mr. McEwen drew from his years of experience at Goldcorp to share his robust plans for his new company: "This year we'll produce 2.8 million ounces of silver and 50,000 ounces of gold. Over the next 3 or 4 years, our silver production will increase by a factor of 2.8 times to 7.8 million ounces of silver, and our gold will go up by 2.6 times to 130,000 ounces. We have projects starting up, too."
One of the most surprising facts about the company is Mr. McEwen's compensation for his work: He receives no salary from the company but holds 25% of the company's shares, which may make him even more highly motivated to protect the shareholders and to achieve his growth goals.
Mr. McEwen is bullish on gold and will help the company in the long term. He said: "In terms of gold and silver, I'm looking at $5,000/ounce price for gold and $200/ounce price for silver about 4 years from now. I'm optimistic about the metal prices and think we have a lot of leverage in silver and good participation in gold."
Along with his expertise in mining, Mr. McEwen is also an avid philanthropist and he speaks passionately about the topic of medicine, one of the many philanthropic endeavors he supports. He has donated $40 million to medical and educational work. $20 million was used to found the McEwen Centre for Regenerative Medicine, which was established in 2006.
Mr. McEwen told us more about the McEwen Centre: "The term "regenerative medicine" is not well understood. Regenerative medicine causes the body to trigger reactions to repair itself – either causing something in the body to provoke a body response; or to take something out of the body, fix it, and put it back in. A lot of that work is with stem cells, although not exclusively stem cells."
The center has 15 principle researchers that deal with issues like cardiac, thoracic, diabetes, spinal, neurological, vision, and more. "The whole premise is based on doing research that isn't funded by the government. Government funding is incremental so we want to make a profound difference for the near term," explained Mr. McEwen.
Later in the conversation, he described the work as being on the "frontier" of medicine, pushing the boundaries beyond what modern medical science has achieved so far. "Our tagline for the center is 'Collaborate, Create, Cure'," Mr. McEwen explained. "Our work is distributed to over 100 separate laboratories around the world. In December I was visiting some friends in Iceland and we went to the research hospital where I was introduced to a research scientist who was working on heart stem cells that we had created." It was a clear demonstration of what we are trying to do; to break down the information silos that prevent innovation in the industry. The innovation doesn't have to happen at our research lab. But if through our collaboration someone else can make a discovery then the world will be a better place to live in."
The Centre has already had some fascinating successes by working on what is described as the frontier of medicine. "We've made some very good breakthroughs," Mr. McEwen said. Then he gave a couple of examples: "90% of the lungs made available for transplant are rejected because they are sub-standard. One of our scientists developed a solution that can put one of these sub-quality lungs on a ventilator, flush it with a fluid of genes and proteins, and a day or two later it's brought up to the standard of what is considered 'ready for transplant'. So people who are on a 5 year waiting list, who may not live that long, have been taking these transplanted lungs. He's transplanted 60 lungs and these people are doing better than the people who got the 'Grade A1' lungs. It seems to have had a very positive impact." And another example: "We were collaborating with the Mount Sinai Hospital in New York. There was a child diagnosed with a syndrome that could have caused death in his teens. We were able to reverse engineer some cells to create the stem cells and create the disease in a dish. Then we sent it back to New York and they were able to apply different medicines to see what the reaction was. They found a medicine that would stabilize the disease. They gave the medicine to the child and the disease is under control."
Mr. McEwen is clearly driven by something far deeper than a desire to find, develop and mine new valuable mineral resources. With more than one significant success under his belt already, he is tirelessly working on new projects in mining and in medicine and is greatly contributing to society.
The Alper family owns McEwen Mining Stock.
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