Canadian Miner Ivanplats Launches Toronto IPO

on Oct 18, 2012

On 16 October 2012, Bloomberg reported that the Canadian miner Ivanplats Ltd (TSE:IVP) sold 63.3 million shares and accomplished its goal of raising about C$300 million (£190 million) at its initial public offering. The company is expected to use the funds raised from its IPO to develop the copper, gold, nickel, platinum and zinc assets it holds in Africa.

**Ivanplats Raises C$300 Million in Toronto**
The Africa-focused miner Ivanplats, which was founded by billionaire Robert Friedland, sold 63.3 million shares for C$4.75 (£3.01) apiece in the largest Canadian mining IPO since 2010, when Tahoe Resources (TSE:THO) raised C$348 million in its share sale. Ivalnplats’ shares were offered within the range of C$4.50 to C$5.40 per share, as indicated in sales documents.

Mining Journal reports that as part of its IPO, Ivanplats has also offered an over-allotment option, also known as greenshoe option, which may be exercised in whole or in part for a period of 30 days following the closing of the offering, for an additional 15 percent of the issued shares. If the greenshoe option is exercised in full, the total amount raised may go up to as much as C$346 million.

!m[Funds Raised To Be Used For The Company’s Projects In Africa ](/uploads/story/596/thumbs/Pic1_inline.png)Ivanplats’ IPO is expected to close on October 23, the same day the stock will begin trading on the Toronto stock exchange under the ticker symbol IVP. Reuters notes that the Toronto Stock Exchange and the Calgary-based TSX Venture Exchange together are the home to roughly 60 percent of the world’s publicly-listed mining companies.

**Africa Projects**
As reported by Bloomberg, Ivanplats has said that it is planning to use the proceeds from the offering for exploration and development of projects in Africa. The company is also expected to complete the purchase of the Kupishi copper and zinc mine in the Democratic Republic of Congo from companies associated with the Israeli mining investor Dan Gertler. In addition, Ivanplats is studying the development of the Kamoa copper deposit also in Congo, and is evaluating the Platreef platinum discovery in South Africa.

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**Mining Stocks Bounce Back**
Reuters reports that over the past year, there have been sharp declines in the share prices of miners on account of the Eurozone crisis and the sluggish growth of the US economy, which have contributed to market uncertainty. In recent weeks, however, investor sentiment started to improve, with the US Federal Reserve announcing its aggressive third round of quantitative easing and China giving the go-ahead to some 60 infrastructure projects.
In consequence, mining stocks have started bouncing back, after having fallen more than 40 percent over the past year, with the S&P TSX Metals & Mining Index having risen more than 20 percent since July. This in turn has given small Canadian miners the confidence to attempt to tap equity markets so as to raise funds to develop their projects.
Mining Journal reports that the overall equity raised in connection with Ivanplats’ IPO would be approximately C$493 million, with the amount also including an estimated C$193 million from pre-IPO bonds, which will be converted into class A common shares upon completion of the offering.

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