Class of 2013 ASX Minerals IPOs: Funding at Decadal Low

John Sykes, Allan Trench

Research output: Other contribution

Abstract

Just 12 new minerals companies managed listings in 2013 raising a total of A$56.1 million. With a downturn in the gold price the share of gold focused IPOs fell, despite consistently strong performance of the gold companies that did achieve a listing. With only limited funds available IPOs are increasingly focused on Australia, which may be seen as a cheaper and/or safer option. This has come primarily at the expense of Africa. However, the fact the continent is the cheapest in the world to make high quality mineral discoveries means this is probably not an overall positive development for the industry. Within Australia, although Western Australia and Queensland consistently attract IPO funds, the greatest intensity of IPO funds again went to an eastern state (New South Wales). This will surprise states such as South Australia and the Northern Territory, which although ranking among the most attractive in the world for minerals exploration, attracted no significant IPO funds from their domestic minerals IPO sector. Overall, the median capital raising size of just A$2.5 million has dropped well below the pre-boom median size of A$4 million. Combined with estimated annual administration costs of A$1 million per annum this suggests that only a minimal amount of exploration will be achieved through 2013 minerals IPO funds.
Original languageEnglish
PublisherCentre for Exploration Targeting, University of Western Australia
Number of pages5
VolumeIssue 27 p. 6-10
Publication statusPublished - Mar 2014

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