The number of Western Australian companies listing on both the Australian Securities Exchange and the Toronto Stock Exchange has risen to 20, after West Perth-based gold producer Troy Resources NL lodged a preliminary prospectus in Canada.
The number of Western Australian companies listing on both the Australian Securities Exchange and the Toronto Stock Exchange has risen to 20, after West Perth-based gold producer Troy Resources NL lodged a preliminary prospectus in Canada.
Troy’s move reflects the growing popularity of the TSX, which has become the world’s leading mining exchange.
Most of the WA companies listing on the TSX have international operations, particularly in South America, Africa and Asia, and believe the Canadian exchange helps to gain more support from international investors.
Michael Kiernan’s Monarch Gold Mining Co Ltd and Dioro Exploration NL have broken this pattern.
Dioro recently raised $57 million through Canada’s Cormark Securities after buying Harmony Gold’s South Kal project.
Monarch is pursuing a TSX listing to help fund its $65 million purchase of Harmony Gold’s Mt Magnet operations, including the Hill 50 mine.
Prime Corporate Finance director Liam Twigger said 57 per cent of the world’s listed mining companies were on the TSX.
“There are a number of very compelling reasons to list on the TSX,” he said.
Number one is the ability to raise equity capital for mining projects.
In the six months to June 2007, mining companies raised $US10.2 billion on the TSX, more than double the amount raised on the ASX and nearly three times the amount raised on the London Stock Exchange’s Alternative Investment Market.
Mr Twigger said the TSX did not suit all companies. The process of listing took about five months and cost close to $1 million.
“You need a $100 million market cap and need to raise $20 million to $30 million to make it worthwhile,” Mr Twigger said.
Troy is aiming to list on the TSX by next February after completing the necessary formal steps, and will decide then how much to raise.
The gold miner recently gained shareholder approval to issue up to 15 million shares, which would raise about $45 million at its current share price.
Its share offer will be made by a syndicate of brokers led by Scotia Capital and including Macquarie Capital Markets, National Bank Financial and RBC Capital Markets.
Chief executive Paul Benson hinted that the company would conduct a relatively large share offer.
“The companies that have been successful on the TSX are those that get enough stock into the market so you have good liquidity,” he told WA Business News.
Mr Benson said the dual listing would give the company access to broader international markets and help fund its growth strategy in Australia, Brazil and Mongolia.
In particular, it is currently investing $US20 million developing its Andorinhas gold project in Brazil, and plans to evaluate an iron ore mine at the same location.
WA companies to have listed on the TSX recently include Bannerman Resources Ltd and Extract Resources Ltd.
