new aim listings

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    What interested me in particular which perhaps I should have known but didn't, is that Titan (TIR) plans to list on AIM.

    AIM braces for Aussie invasion

    By: Ken Gooding

    Posted: 2003/07/02 Wed 14:37 ZE2 | © Mineweb 1997-2003

    LONDON – As many as 15 Australian exploration and mining companies will join the London Stock Exchange’s Alternative Investment Market (AIM) in the coming 12 months, according to Rob Adamson, corporate financier at the RFC investment bank.
    This compares with the present total of ten. Surprisingly, Adamson said the fresh Aussie rush to AIM was not being sparked by the LSE’s new “fast track” admission procedure but because Australian companies have wised up to the fact that the cost is only half of what it once was.

    Adamson talked to Mineweb after the “Emerging Resource Companies Showcase” organised by RFC Corporate Finance, London’s Numis Securities, and the LSE itself which, among other things, provided a spectacular view from the 23rd floor of the Stock Exchange building.

    The occasion gave a clear indication of how much importance AIM executives now place on the exploration and mining sector. Of the 700 or so companies now listed on AIM, 42 are involved in exploration or mining and between them they have raised more than US$520m.

    And the pace is already increasing. In the past 12 months some 15 companies from the sector have joined AIM – the latest, African Eagle (LSE:AFE), in which South Africa’s Gold Fields has a big shareholding, began trading a week ago (on June 25) after raising nearly £1.5m for its projects in Tanzania, Mozambique and Zambia.

    Some of the companies involved in the Showcase presentations already have London listings: Aquarius Platinum (LSE:AQP), Consolidated Minerals (LSE:CNM), LionOre Mining(LSE:LOR) and First Quantum Minerals (LSE:FQM). They were able to offer advice to executives representing other Aussie companies - executives who made it very clear the main reason they were in London was to investigate the possibility of listing on AIM.

    They included: Anvil Mining (ASX:AVL), which operates the Dikulishi open pit copper mine in the Democratic Republic of Congo; Ballarat Goldfields (ASX:BGE), now with a new board and management team but still searching the historic goldfields in the State of Victoria; Bolnisi Gold (ASX:BSG), currently producing gold from its Quartzite heap leach project in Georgia; Red 5 (ASX:RED), earning an 80 percent stake in the Siana gold project in the Philippines; Sallay Malay (ASX:SMY), with a nickel sulphide project in Western Australia; Titan Resources (ASX:TIR), which has two advanced nickel projects, also in Western Australia; and Western Areas (ASX:WSA), no relation to the South African group but which has a 75 percent interest in the Forrestania nickel project in Western Australia.

    RFC’s Adamson pointed out that companies with gold projects in Australia had no trouble at all raising money from Australian investors. However, those with projects outside Australia or involving unusual minerals tend to get the cold shoulder. These were the companies that would turn to AIM to raise finance. However, much would depend on commodity prices – if they started to rise substantially, much more money would be available in Australia for all types of projects.

    RFC, was the first Australian company to be granted nominated adviser, or nomad, status by AIM. Nomads are unique to AIM and have the job of vetting all AIM candidates and ensuring they are suitable for listing. Then nomads have to make sure their clients follow all the rules.

    For the London presentation, RFC teamed up with Numis, a financial services group that for the past year has been making inroads in the mining sector. Among other moves, it recruited a mining team including analyst John Meyer. Numis acted as broker when Consolidated Minerals listed on AIM last year.

    Adamson said RFC itself expected to bring seven Australian companies to AIM in the next 18 months. Australia is among the countries to benefit from the LSE’s new “fast track” route to AIM, launched last month (June).

    This route allows mining companies already listed on nine markets around the world – including the Australian Stock Exchange, Toronto Stock Exchange and JSE Securities Exchange (South Africa) – to use the paperwork from their existing listing as a basis for a complementary quotation on AIM, thereby reducing the red tape required.

    Charlotte Crosswell, the LSE’s head of international business development, suggested that resources companies chose London because investors here had a much deeper understanding of exploration and mining than those in New York. Often companies did not need to raise money immediately when listing – “but they know that, once listed, they can tap the market when necessary.”

    This is certainly the case with one of the presenting companies, LionOre, the mid-tier nickel producer which gained a listing on London’s main board in January to complement its Toronto quote (TSX:LIM).

    LionOre did not need money at that time and still has not appointed a broker in London, so there is no market here in its shares. Colin Steyn, the Zimbabwe born but London based president, explained that he and his team have been focused on the proposed merger with Dalrymple Resources (ASX:DRE) that will bring together the two owners of the Thunderbox gold mine and Maggie Hays nickel deposit in Australia.

    LionOre, which also owns 80 percent of Tati nickel in Botswana, has set itself a target of building its annual nickel output up to 30,000 tonnes in three years, using its Activox process for some of the output. Steyn acknowledged that, in order to achieve that objective, the time will come when he will turn to London investors for money.

    Some observers have suggested that Inco, the Canadian group that is the world’s second biggest nickel producer after Russia’s Norilsk, might bid for LionOre at some stage. Steyn dismissed this idea by pointing out that Inco’s stake in his company was under 2 percent and would drop when the Dalrymple merger was completed. In any case, he said, Inco had its hands full attempting to bring its big Voisey’s Bay nickel project in Canada into production.

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