The decision to list and source capital has as much to do with the project as it does with the market in which the listing or raising is being considered.
The decision to list and source capital has as much to do with the project as it does with the market in which the listing or raising is being considered.
A major reason Perth-based imminent gas producer Po Valley Energy Ltd is looking to seek a dual listing on London’s Alternative Investment Market (AIM) is international investors who are more attuned to the European energy crisis and its ultimate benefits for the company.
The value of Po Valley Energy’s assets in northern Italy, about 105 billion cubic feet of proven/probable gas scheduled for production at the end of the year, was given added impetus late last year when Russia slashed supplies to the Ukraine over a pricing/political dispute.
The crisis has sparked fears that huge Russian gas exports to Western Europe could be hit as most of the gas goes through Ukrainian pipelines. Po Valley co founder and chief executive officer Michael Masterman told WA Business News the Ukraine gas crisis was “a major energy supply wake-up call for Europe that has seldom been off European front pages since”.
Po Valley’s is a good story and AIM a relatively cheap entry into Europe’s biggest investment market. “And that’s our market,” Mr Masterman said.
For Australian companies seeking greater market coverage and opportunities, and can handle dealing across three jurisdictions or time zones, there is the option of listing on both AIM and the burgeoning, more speculative, Toronto Stock Exchange (TSX).
This is the route preferred by aspiring platinum group minerals producer Platmin Ltd, as it prepares for AIM listing in the next three months.
Mineral Security’s Ltd has a near 20 per cent stake in the company and its executive chairman Keith Liddell has set a strategy for a small AIM raising to complete the $20 million feasibility study on Platmin’s major Pilanesberg project in South Africa, with the option of a later dual TSX listing and larger fund raising to develop the project.
Platmin knows the London market. Mr Liddell was managing director of the fabulously successful Perth-based southern African platinum producer, Aquarius Platinum Ltd, currently listed in Australia, London and Johannesburg.
In the past three months, Perth-based copper/uranium aspirant Equinox Resources Ltd has raised $210 million for the $750 million Lumwana project in Zambia which it expects to have in production from late 2007 or early 2008. Eighty per cent of $170 million raised via prospectus issues in Australia and Canada came via the TSX.
Equinox CEO Craig Williams told WA Business News the potential to tap into the very resources focused Canadian market, with its direct links to the US market was “too compelling an argument”.
“There has been a long relationship between London and Africa,” he said in reference to not taking the AIM route.
“But the Canadian market is perfect for a company and a project like ours.”
