Cotec Holdings (TSX-V: CTH)(OTCQB: CTHCF) CEO Julian Treger on Creating a Multi Billion Dollar Company


Gerardo Del Real: This is Gerardo Del Real with Resource Stuck Digest. Joining me today is the CEO of CoTec Holdings, Mr. Julian Treger. Julian, it's great to have you back on. How are you today, sir?

Julian Treger: Great. Thank you for having me on today. Thanks so much.

Gerardo Del Real: Well, listen, let's get right to it. We talked briefly off-air. There is clearly a critical metals Cold War going on, and CoTec is really, really smartly positioning itself to take advantage of it. It's a very unique business model. It's a very unique story. You know it better than most. It's probably not a coincidence that you own as many shares as you do, but I wanted to have you back on to talk about where we are with this Cold War that's materializing, not so much behind the scenes anymore because it's pretty open now as far as tariffs and actually seeing it in the market. What are your thoughts on what's developing there?

Julian Treger: Well, I think it is absolutely now a high-profile item. I think the Chinese had the arena pretty much to themselves for a long time. So they established a dominant position in many minerals, and then we had this pricing collapse in the minerals, which they own lots of, like of nickel or lithium, they control the supply chain, and I think that was going to drive down the cost of batteries. And that in turn has been driving down the cost of electric vehicles.

And I think when it came to endangering the whole US vehicle manufacturing sector, I think the politicians really sat up and took note. And so we're now starting to see a fightback. And as you say, we are pretty well positioned for this because we've been focusing not on the commodities which China really can control the pricing of, other than rare earths and rare earth is such a specific and special category that the West has to provide its own rare earths. And these tariffs are actually going to really benefit our US magnet recycling rare earth business when they come in because it'll make the margins much higher. So I think we are well positioned to benefit from this, but it is a part of the potential Cold War between the east and the west that's certainly unfolding before our eyes.

Gerardo Del Real: Well, listen, it's not just rare earths either, right? We clearly are seeing a bifurcation in the market with supply deficits that are materializing across the commodity space. We have copper at all time highs. We have gold at all-time highs. And I know that CoTec is really focusing on being right in the sweet spot of the cycle to take advantage of the most profitable years. And I can't stress that enough to listeners. There's a lot of companies that copper makes new highs and you have a hundred new copper companies come out exploring for a deposit, but by the time they discover something, if they discover something, they've missed the profitable part of the cycle. And CoTec is the complete opposite of that. You're positioned perfectly. Can you speak to how you plan to take advantage of these deficits and these record high prices that we're seeing across the board?

Julian Treger: Absolutely. Our model, rather than relying upon a new mine, which can take up to 20 years to come into production, our business model is to focus really on a lot of recycling, a lot of brown re-openings. We're not going to go into the development business. We're going to be able to produce revenues within three to five years, which is at warp speed relative to the way the industry's been developing historically. And we've chosen the sectors so far, which are the ones which we think are important for the energy transition and also for the independence of the Western supply chain. So we are in copper and we're developing a green copper division. We are in green steel inputs, which I think is going to be super important for the US. And there's already a premium developing in the US market vis-a-vis the rest of the world.

And as we've talked about, we are also in the rare earth magnet space, which we would hope to be our first source of revenues coming online in two years from now. So I think we will be able to be more real-time relatively to other models in the mining sector. Obviously we can't pivot in a moment, but I think the areas that we're focusing on are super interesting because there's an increasing recognition, particularly in Washington that recycling waste are the areas where there's a lot of material. And this is a way in which the supply gap can be plugged in the short term. So it can really help the west in this battle to increase its self-sufficiency.

And we are looking at other technologies which can help us again, unlock other areas. The next potential technologies we're looking at are ways in which we can use the waste that is sort of very fine material, which can't be used at the moment to extract metals, and also a way in which we can use very hard materials, which are very difficult to unlock and the grinding of that uses a lot of energy. We've got a new technology which can potentially unlock that more easily as well. So it's super exciting and I think it's very much part of the way in which this whole sector is evolving.

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Gerardo Del Real: You recently closed a financing, I believe it was to the tune of roughly $3 million. Can you speak to your personal holdings? I think it's important. I'm really, really big on having skin in the game and cooking what you eat and eating what you cook. And you most definitely do that sir, how is the personal holdings for CoTec and how much does management own?

Julian Treger: Well, I'm trying to increase my holding to the maximum that I can. With the visibility that we have in terms of what we've already created, and we'll hopefully see some of that being unveiled in the coming quarters. I think the business is worth a multiple of what it's currently trading at. And so I put up $2 million as part of the last round and I would continue to support the business. I think my shareholding’s now around 40, 42%. When I got involved with CoTec, I didn't own any shares, so I'm continuing to build my position together with the other board members. I think we have 60%, so every time we spend a dollar, we're spending 60 cents of our money. We're very careful about that, but we are also supremely confident that what we're doing is creating huge amounts of value. We will shortly be creating a new division called CoTec Green Iron, and we see lots of strategic investors. Not so much retail investors who don't yet appreciate what we're achieving, but strategic investors very interested in what we are on the road to creating.

Gerardo Del Real: I'm excited for the rest of the year. I'd like to point out that the recent financing was priced at 50 cents. The stock trades for 49 cents right now. You can buy it for a penny less than what Julian just recently paid. It's one of the most fascinating speculations in the space because of the uniqueness of the model. And I'm really looking forward to seeing you all execute here over the coming quarters and years. Julian, anything to add to that?

Julian Treger: No, I think I share your excitement. We are super ambitious, as you'll see from our board, we aim to create a multi-billion-dollar business over the next decade, and it can be done. We've got a track record of creating several billion dollars of value in the natural resources sector. We've generally made six times our cost. That's our track record and we think we can do the same here. So yes, absolutely. Let's see the coming announcements, and thank you for circling back with me and getting an update.

Gerardo Del Real: Well said, sir. Thank you so much. Appreciate the time.

Julian Treger: You too. Thank you so much.

Gerardo Del Real: All the best. Cheers.

Julian Treger: Very good. Bye-Bye.