1 accessing capital for african mining projects greg ferron senior manager, global mining, listings...
TRANSCRIPT
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Accessing Capital for African Mining Projects
Greg Ferron
Senior Manager, Global Mining, Listings
Toronto Stock Exchange and TSX Venture Exchange
3rd Annual Investing in African Mining
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Disclaimer
This document is for information purposes only and is not an invitation to purchase securities listed on Toronto
Stock Exchange and/or TSX Venture Exchange or Natural Gas Exchange. TMX Group Inc. and its affiliates do
not endorse or recommend any securities referenced in this document. Please seek professional advice to
evaluate specific securities.
While the information herein is collected and compiled with care, neither TMX Group Inc. nor any of its affiliated
companies represents, warrants or guarantees the accuracy or the completeness of the information. You agree
not to rely on the information contained herein for any trading, business or financial purpose.
This information is provided with the express condition, to which by making use thereof you expressly consent, that
no liability shall be incurred by TMX Group Inc. and/or any of its affiliates as a result of any errors or
inaccuracies herein or any use or reliance upon this information.
© 2009 TMX Group Inc.
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Contents
1. Globally Competitive Exchanges
2. Current Mining Market Activity and Africa on TMX
3. Accessing TMX
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Canada’s Economy and TMX are Robust
Currency – Increasing against the USD
Strong Banking System
Resource-Rich Potash, Uranium, Oil Sands, Natural Gas, Nickel, Copper
Increased Investment from China
Access to Capital at Early Stage for Juniors
Balanced Corporate Governance Model
Canada TMX
Record Year for Financing
~40% of daily trading comes from international brokers
1st in Mining – 57% of the world’s public mining companies
1st in Energy – 43% of the world’s public energy companies
Record Year in Mining
Diversified Mining Exchange
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TMX Group is a Multi-Asset Class Market Leader
(53% Ownership)
(47% Ownership)
(19.9% Ownership)
Data
Energy
Derivatives
Fixed Income
Equities
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Access to Capital on Toronto Stock Exchange
EQUITY FINANCING ON TORONTO STOCK EXCHANGE (C$B)
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 YTDSept
Public Offerings Private Placements IPOs
$23.1
2009 YTD September equity capital raised
surpasses equity capital raised in all of 2008
$21.1$25.8
$37.6
$46.5 $46.2
$41.8
$47.6
$35.3
$44.5
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International Investment Community Tradeson Toronto Stock Exchange
25 International Brokers including: Barclays Capital Citigroup CSFB Deutsche Bank Goldman Sachs HSBC JP Morgan Macquarie Capital Markets Merrill Lynch Morgan Stanley Raymond James Thomas Weisel State Street UBS
80 Canadian Brokers including: BMO Nesbitt Burns Canaccord CIBC World Markets GMP Securities RBC DS Scotia Capital Markets TD Securities National Bank Financial
220.9 242.7 255.6326.9
382.1435.2
485.8
2003 2004 2005 2006 2007 2008 2009 YTDSept
~40% of TSX daily trading originates from international brokers for their
institutional and retail clients
Average Daily VolumeToronto Stock Exchange
Sh
are
s T
rad
ed
(mill
ion
s)
8
Average Number of Analysts by Size of Mining Company
12
3
6
16
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Market Capitalization (C$ Millions)
100-250 >50050-10025-50<25
Source: Thomson One
250-500
Global Visibility
Companies of all sizes receive analyst coverage
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Contents
1. Globally Competitive Exchanges
2. Current Mining Market Activity and Africa on TMX
3. Accessing TMX
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Mining activity on Toronto Stock Exchange has increased significantly this year
$88
$537
$1,507
$212 $102
$1,018
$345$63 $44 $95 $239
$1,032
$254
$2,113$1,970
$1,452
$290
$1,808$2,059
$671
$6,352
0
1000
2000
3000
4000
5000
6000
7000
Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09
Eq
uit
y C
ap
ital
Ra
ised
(C
$M)
0
50
100
150
200
250
300
350
400
450
Ma
rke
t Ca
pita
lizatio
n (C
$B
)
Mining Equity Capital Raised on TSX (C$M) TSX Mining Market Cap (C$B)
Top 3 Mining Financings in September 20091. Barrick Gold Corporation - $4.3B SO2. Paladin Energy Ltd. - $400M PP3. Silver Wheaton Corp. - $308M SOEight financings in September were over $100 M
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Mining Dealflow on TMX in 2009
Increase in gold, silver, copper and uranium financings• $19.7 billion raised across all commodities in the first ten months of 2009 (including TSX VN)• Producers and developers accessing most of the capital until second half of 2009• Significant capital raised for projects in Africa and by TSX listed international mining companies
Increase in consolidations and takeover bids between TSX and TSXV miners and with International miners including recent examples - Goldcorp and Canplats, First Quantum and Kiwara Plc, Randgold and Moto, Cliffs and Freewest
New players coming to our markets – investors, senior management and foreign mining
companies • Shift of activity to traditional mining exchanges both management and capital
Significant improvement in valuations on both TSX and TSXV • S&P/TSX Metals and Mining Index, TSX Mining Sector and TSXV mining sector valuations bouncing
back; up 240%, 50% and 83% respectively this year
Earlier stage capital returning to TSX Venture Exchange• Exploration financings returned to historical levels in June 2009• $1.8 Billion raised in over 1,000 + financings this year and new listings are active
Signs of life:• Bought deal financings picked up significantly earlier in 2009• IPO market is starting to open up• Trading volumes remain robust - volume up 15%, value down (27%) and number of trades up 5% • Increase in interlisted mining companies
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Mining Market Comparison for YTD September 2009
TSX is having a record year for mining finance
TSX
LSE
ASX
TSXV
AIM
333
37
619
1076
143
No. of Issuers Listed
$310B
$383B
$237B
$16B
$17B
Quoted Market
Value (C$)
$17B1
$20B2
$11B3
$1.5B
$1.0B
Equity Capital
Raised (C$)
264
3
130
1173
119
No. of Financings
10
1
8
53
0
No. of New
Listings
1 Includes $4.3B Barrick Gold financing2 Includes $12.4B Rio Tinto and $7.2B Xstrata financings3 Includes $4.2B Rio Tinto financing
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International Mining Companies By The Numbers
123Mining
Companies
$47B
Market Cap
$4BRaised Through 140 Financings
10BShares Traded
Through 5 Million
Transactions
5Average Number
of Analysts Covering Int’l Mining Cos.
As at and YTD September 30 2009
Australia, 26, 21%
USA, 57, 47%
UK/ Eur, 11, 9% Africa,
10, 8%
Latin America,
5, 4%
China, 11, 9%
Other, 3, 2%
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Dual Listing Market Continues to Evolve on TSX
Key Trends
•Growing number of dual listed success stories
•Dual listed cos. have steadily built profile
•Greater interaction between key mining exchanges
•Significant trading and capital raised on TSX
• Improvements in home market valuations and trading liquidity
• More mines put into production
• Streamlined dual listing process
• New trends
Dual Listed Companies:
15Source: Exchange Websites *Includes RTOs and QTs on TSXV
619
21481 68 38 48
1409
TSXTSXV
ASX LSE-AIM
HKEx NYSEAmex
J SE NYSE
TOTAL NUMBER OF MINING ISSUERS
299 5 3 3 2
138
TSXTSXV*
ASX LSE-AIM NYSEAmex
NYSE HKEx JSE
TMX exchanges continue to list more mining companies than any other market
NUMBER OF NEW MINING LISTINGS IN 2008
8 3 1 1 1 0
59
TSXTSXV*
ASX HKEx LSE-AIM NYSEAmex
NYSE JSE
NUMBER OF NEW MINING LISTINGS YTD SEPT 2009
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TMX is the Top Exchange for Mining in Africa
169Number of Companies
Mining in Africa
681Number of
African Mining Properties
44Number of
Countries in Africa Where
TSX/TSXV Cos. are Mining
68Number of
Financings for African Mining
Projects50
6338
117
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$2.1B
Amount of Equity Capital Raised so far This Year for African
Mining Projects
17
11
20
20
23
16
20
1911
16
10
20
5
56
5
5
59
6
5
50
6338
117
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Number of TSX and TSXV Mining Companies Operating in Africa by Region
Top 10 Countries
South AfricaBurkina FasoDRCMaliTanzaniaGhanaNamibiaNigerBotswanaGuinea
TSX and TSXV Mining Companies in Africa
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1. First Quantum Minerals Ltd.: $345 million raised for copper and diamond in DRC, Mauritania, Zambia
2. IAMGOLD Corp.: $345 million raised for gold in Burkina Faso
3. Katanga Mining Ltd.: $282 million raised for copper in DRC
4. Equinox Minerals Ltd.: $184 million for copper in Zambia
5. Red Back Mining Inc.: $165 million for gold in Ghana, Mauritania
6. Banro Corporation: $117 million for gold in DRC
7. Centamin Egypt Ltd.: $98 million for gold in Egypt
8. Denison Mines Corp.: $95 million* for uranium in Zambia
9. Moto Goldmines Limited.: $50 million for gold in DRC
10. Semafo Inc.: $40.5 million for gold in Guinea, Niger, Burkina Faso
Top 10 Financings into Africa
Source: Gamah International, September 2009, Compiled by TMX Group*Denison Mines raised $214 million through three financings. Amount raised for Zambian project is an estimate.
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Contents
1. Globally Competitive Exchanges
2. Current Mining Market Activity and Africa on TMX
3. Accessing TMX
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How can AIM or International companies access TSX?
Public mining companies dual list on a TMX exchange and remain listed on home exchange
Private companies can access via IPO or RTO/CPC
Access the TSX or TSXV through an M&A transaction or the Capital Pool Company Program (CPC)
• 33 Mining Qualifying Transactions in the first nine months of 2009
• 200+ available CPCs currently trading on TSXV
• 2,021 listed CPCs since inception and 80% Qualifying Transaction rate
• 247 CPCs currently trade on a TSX
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Centamin Egypt Ltd.TSX:CEE ASX:CNT LSE:CEY
An Australian Based Dual Listed Success Story Focused on Gold Exploration in Egypt
Exchange Toronto Stock Exchange
Date of Listing April 4, 2007
Type of Listing Direct Listing
InterlistingListed on ASX on October 8, 1970
Listed on AIM on December 21, 2001 and moved up to LSE on October 7, 2009
Financings $134.4 Million Private Placement in November 2007
$69 Million Secondary Offering in February 2009
Market Capitalization $2.2 Billion (as of October 26, 2009)
Trading2008 Average Daily Trading Volume: 856,330 shares
2009 YTD September Average Daily Trading Volume: 2,852,770 shares
Analyst Coverage13 UK analysts and 3 Canadian analysts cover Centamin Egypt Ltd. (as of October 26, 2009)
Company DescriptionCentamin has been exploring for gold in Egypt since 1995, and in 2005 was granted a 160km 2 exploitation lease over the massive Sukari Hill gold project.
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Equinox Minerals LimitedTSX:EQN ASX:EQN
An Australian Based Dual Listed Success Story Focused on Copper in Zambia
Exchange Toronto Stock Exchange
Date of Listing June 29, 2004
Type of Listing Canadian IPO by Prospectus Offering
Interlisting Listed on ASX on June 21, 2004
Financings
$17.25 Million IPO in June, 2004
$155.6 Million through three private placements in 2005
$139.1 Million through two private placements and one secondary offering in 2006
$215.3 Million secondary offering in March, 2007
$160.0 Million Secondary Offering in April 2009
Market Capitalization $2.5 Billion (as of October 27, 2009)
Trading2008 Average Daily Trading Volume: 2,898,471 shares
2009 YTD September Average Daily Trading Volume: 4,871,673 shares
Analyst Coverage15 Australian analysts, 13 Canadian analysts and 2 US analysts cover Equinox Minerals (as of October 26, 2009)
Company DescriptionEquinox Minerals Limited is an international mining company focused on operating its 100% owned Lumwana Copper Project in Zambia.
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TMX Group has listing criteria specifically for the mining sector
This table is an overview. For detailed listing requirements, go to www.tsx.com
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Companies can capitalize on TMX Leadership
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Contact InformationGreg FerronSenior Manager, Global Mining, ListingsToronto Stock Exchange & TSX Venture Exchange