Date post: | 04-Nov-2015 |
Category: |
Documents |
Upload: | emil-azhibayev |
View: | 213 times |
Download: | 0 times |
of 28
Raising capital in the heart of the worlds financial markets for global mining companies June 2012
2
London is the leading international listing venue
All information is current at 25 January 2012 *Source: World Federation of Exchanges
(1) Source: Bloomberg : (2) Source: Bloomberg . Refers to sector revenue, operating profit, throughout the past 12 months
LSEG HKSE NYSE TMX Group ASX JSE
Domestic Market cap* USD 3,397 bn USD 2,258 bn USD 11,795 bn USD 1,912 bn USD 1,198 bn USD 798 bn
Number of listed companies (of which international)*
2,886 (598)
1,496 (24)
2,308 (520)
3,945 (100)
2,079 (96)
253 (2)
Flagship Index FTSE 100 Hang Seng Index Dow Jones Industrial
S&P/TSX Composite S&P/ ASX 200 FTSE JSE Top 40
International companies in the index Yes No No No Yes Yes
Number of Mining Companies Listed ((1) 143 41 28 1,376 649 36
Mining Sector Combined Market Cap (1) USD 601 bn USD 98 bn USD 155 bn USD 283 bn USD 440 bn USD 94 bn
Mining Sector Revenues (2) USD 385 bn USD 54.76 bn USD 57.38 bn USD 57.33 bn USD 151.42 bn USD 34.56 bn
3
0
2,000
4,000
6,000
8,000
10,000
12,000
0
100
200
300
400
500
600
700
800
900
1,000
LSEG TMX Group HSE ASX JSE
No. of tran
sactions (00
0)
USD
(m
)
Number of tradesValue of trades
Leading global exchange
Average daily traded value (ADTV) and number of trades in shares in 2011
(1)By number and market capitalisation of listed companies (2)by value of transacted shares Source: World Federation of Exchanges
As At 31 December 2011
2,886 companies sharing an aggregate market cap of above to USD 6 trillion
598 international companies with aggregate market cap exceeding USD 3.1 trillion.
Over 600 member firms have access to our trading systems
During 2011, an average of over USD 11.6bn worth of shares were traded daily on the LSEGs markets, more than any other exchange in Europe.
London Stock Exchange Group is the largest equity market in Europe(1)
and has one of the worlds most liquid secondary markets(2)
We operate one of the largest and the most liquid equity markets globally
4
Return to heightened volatility has implications for companies financing decisions
Despite market volatility the London Stock Exchange has seen active IPO and secondary fundraising markets
A total of 12.9bn was raised in IPOs on the London Stock Exchange in 2011, up 29% on 2010
5
First in global IPOs
0
100
200
300
400
500
600
700
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
#IPO
s
LSE NYSE Euronext (US) Hong Kong Deutsche Borse NYSE Euronext (Europe) Shanghai
Source: (1) London Stock Exchange calculation. (2) World Federation of Exchanges. Latest extraction 31 January 2012
We are historically a venue of choice for companies conducting their IPOs(2)
We continue to lead in IPOs in 2010 & 2011(2) The London Stock Exchange has become the listing venue of choice due to:
Internationally minded investor community Unique concentration of advisors with experience in listing international companies Robust and appropriate regulation Peer group in a diverse range of sectors Unparalleled profile and prestige Widest choice of market and listings routes
We have consistently been the market of choice for issuers from around the world
Relative capital raisings on the London Stock Exchange over the last ten years, by region(1)
>USD15bn USD 2-15bn USD
6
The Bloomberg European U.K. IPO Index is a capitalization-weighted index which measures the performance of stocks during their first publicly traded year. It includes all companies with a market value of at least 50million at the initial public offering. The index was developed with a base value of 100 as of September 28, 2001. The parent index is BEUIPO.
Source: Bloomberg February 2012
London IPOs continue to demonstrate strong post IPO performance
Bloomberg IPO indices 2 year post IPO performance
7
A London listing enables companies to access a significant investor base operating in London as well as the widest range of global investment pools
London based investors have a long standing tradition of investing in international companies
London IPOs regularly attract investment from key cornerstone investors and sovereign wealth funds from across the world
*Based on international equity AUM in key financial centres. NYSE Euronext (Europe) data is given only for Paris. TSX data is only available for the latest quarter. Sources: Ipreo, Q1 2012.
London investors tend be more internationally focused
London home to international investors We provide access to the worlds largest pool of international equity assets*
London New York
Inte
rnat
iona
l Equ
ity
asse
ts u
nder
m
anag
emen
t (U
SD b
n)
Equity assets under management held by foreign investors
USD
bn
LSEG trend line
Competitors weighted average trend line % 2-year 37
%
Leading destination for international investors
% 2-year -23%
8
sitting in a time zone which can trade with the world
London is a global hub for international investors
USD million
Assets managed in the UK and globally out of London ten largest investment firms
Source: Investment Management Association: Asset Management in the UK 2009-2011.
All major global investors sit in London are able to access London Stock Exchange traded stocks
0 -11 -10 -9 -8 -7 -6 -5 -4 -3 -2 -1
0 +1 +2 +3 +4 +5 +6 +7 +8 +9 +10 +11
London trading hours
9
Average daily trading velocity (6month average daily trading value / free float adjusted mkt cap)
We provide high levels of liquidity Londons investment pool offers liquidity for a large portion of LSE issuers
>1% 0.5% - 1% 0.2% - 0.5% 0.1% - 0.2% 0.1%<
More than half of LSE traded companies enjoy medium to high levels of liquidity
Our platforms are designed in a way to maximise liquidity for different types of securities
London Stock Exchange offers superior technology solutions which deepen issuers liquidity
Creation of derivatives and exchange traded funds can contribute to further increase in liquidity potential
Source: Bloomberg, March 2012.
Deutsche Brse NYSE Euronext (Europe)
HKSE
London Stock Exchange
10
London - the home of global and ambitious mining companies
Antofagasta 1888* Glencore, 2011 ENRC - 2007
Fresnillo 2008
NWR 2008
African Barrick Gold
2010
Yamana Gold 2007
Xstrata 2002
Anglo American 1999
Aquarius Platinum 1999
Vedanta 2003
Kazakhgold 2005
USD 450 billion sector - The London Stock Exchange lists many mining giants
as well as smaller companies in pre-production stage.
*First listing in 1888; second listing in 1982.
11
Mining fundraisings on the London Stock Exchange recent trends
2011
$12.7 billion total money raised - $10.8 billion in new issues - $1.9 billion in further issues
2000 - 2011
$69.7 billion total money raised - $27.6 billion in new issues - $42.1 billion in further issues
More than 1/3 of global mining fundraisings raised on the London Stock Exchange
Source: London Stock Exchange Sta3s3cs, World Federa3on of Exchanges, Bloomberg
12
0
1
2
3
4
5
6
2006 2007 2008 2009 2010 2011
USD
bn
Total money raised in mining IPOs
LSE NYSE HKSE TSX NASDAQ Euronext
Strength in listing mining companies
LSE NYSE ENXT (US)
NYSE ENXT (EU)
HKSE TSX ASX
No. of IPOs in the last 12 months (of which international)
7 (7)
1 (0)
0 5 (4)
36 (1)
56 (3)
Money raised (USD) 10.7bn
200m 0 666m 260m 338m
Last 12 months average weighted performance*
-2.4% n/a n/a -3.08%
-0.25%
-0.28%
Average fees paid in the last 12 months
1.75% 7.00%
n/a 3.00% 8.10% 5.22%
*of companies completing their IPO over last 12 months. Source: Dealogic, April 2012
Main Market
Money raised: USD 913m African focused gold producery
March 2010
Main Market - Premium
Money raised: USD 9.75bn UK largest ever IPO of a Swiss based mining conglomerate
May 2011
AIM
Money raised: USD 20m Gold exploration and
development company
June 2011
AIM Money raised: USD 98m
Iron ore company with operations based in the Republic of Congo
November 2010
AIM Money raised: USD 16m Gold exploration and
development company
June 2011
Main Market Premium Money raised: USD 780m
A leading Russian gold and silver producer.
November 2011
AIM Money raised: USD 52m A coal exploration and development company
June 2010
AIM
Money raised: USD 60m Mining company with operations
in the Philippines
December 2010
USD 10.7bn
13
LSE NYSE ENXT (US)
HKSE TSX NYSE ENXT (EU)
ASX
No. of companies 182 47 30 1,386 10 663
Mkt cap (USD) 450bn 626bn 142bn 246bn 185bn 431bn
Price to Book ratio 3.11 2.30 2.56 9.64 3.04 2.71
Average Daily trading volume (shares)
1.95m 3.26m n/a 0.14m 0.02m 0.77m
Trading velocity 0.34% 2.01% 0.52% 0.20% n.a 0.42%
LSE offers a diverse investors base for mining companies
Strength in listing mining companies
Source: LSEG data, Bloomberg and Factset, April 2012
14
London Stock Exchange offers a diverse range of markets
Main Market EU Regulated markets
Exchange Regulated markets
AIM Professional Securities
Market
Specialist Fund Market
Securities admitted to official list
(maintained by UKLA)
Securities not admitted to official list
(maintained by UKLA)
The choice of market will depend on a number of factors including:
Stage in a companys development Complexity of the offer and securities issued Target investors Companys size Company's strategy and objectives
From Small to Large:
15
Global costs of listing, a comparison*
Listing in London continues to be the most cost effective option
*Based on gross underwriting fees, (excluding AIM) Source: Dealogic, February 2012.
The costs of listing in London are the lowest amongst major exchanges
Cost of listing in London is further reduced by:
Regulation which is widely tested and balanced
Timing of the admission process is clearly communicated
Regulator which provides consistent and predictable comments
Direct communication with the regulator and the Exchange
Highly competitive legal services which have deep experience in listing process
All disclosures in English
16
Listing in London enables eligible companies to enter the FTSE UK series
FTSE UK Index Series
FTSE All share Index FTSE All-small Index
FTSE 100
FTSE 250
FTSE 350
FTSE All Sector Index
FTSE Small Cap Index
FTSE UK series is one of the worlds most widely tracked family of indices FTSE UK Series is the only flagship index series of any major exchange to admit international companies Premium listing on the London Stock Exchange enables issuers to get access to tracker funds According to a recent survey(1) FTSE UK series inclusion brings on average 20% additional investment
Investment pool available to UK companies Passive and active funds in London
(1)Source: Investment Management Association: Asset Management in the UK 2009-2010
17
Premium listing on Main Market of the London Stock Exchange
Not Eligible
FTSE UK Index Series decision tree
Yes No
Incorporation?
UK Overseas
Incorporated in FTSE developed country?
Yes No
Free float >50% at admission? Incorporated in low taxation jurisdiction as approved by FTSE?**
Yes No
Adherence to principles of UK Takeover code, UK Corporate Governance Code and pre-emption rights Not eligible
Yes
No
Not eligible
Eligible (if free float>25%)*
Yes No
Potentially eligible* Not eligible
*Each company inclusion into FTSE UK Series is individually assessed by the FTSE practitioners committees. Eligibility is dependent on the company passing liquidity screening. The calculation of the minimum free float will be based on the ordinary share capital issued by the company and may include shares that would otherwise be excluded solely because
they are subject to a lock-in clause of twelve months or less from their first day of trading, but that would in all other respects be considered part of a companys free float. **Examples of low taxation countries include: BVI, Bermuda, Cayman Islands, Guernsey, Isle of Man, Jersey, Marshall Islands.
A premium listing on the London Stock Exchange enables eligible companies to enter the FTSE UK series of indices
18
Listing Rules
All companies require a 3 year financial history or as short a period as the company has been trading
Company is required to produce a Competent Persons Report (CPR) describing nature and extent of the companys rights of exploration, geographical characteristics of reserves, estimates of volume, expected extraction volume together with assumptions on forecast revenues and operating costs. For Hydrocarbon deposits, porosity and permeability characteristics, net pay, pressure and recovery mechanisms should be detailed in the CPR.
Aggregate value of reserves (proven and probable) as estimated in the CPR should not be less than 50% of expected aggregate value of equity share capital at listing
Where company does not hold a controlling interest in a majority (by value) of property, fields etc. it has invested in, it must have a reasonable spread of direct interests in mineral resources, and must have influence in decisions over the timing and method of extraction of those resources.
Listing Rules (LR6)
Mineral Companies (i.e. Mining, Oil & Gas) exempt from 3 year track record requirement
Company is required to produce a Competent Persons Report (CPR) describing nature and extent of the companys rights of exploration, geographical characteristics of reserves, estimates of volume, expected extraction volume together with assumptions on forecast revenues and operating costs. For Hydrocarbon deposits, porosity and permeability characteristics, net pay, pressure and recovery mechanisms should be detailed in the CPR.
Aggregate value of reserves (proven and probable) as estimated in the CPR should not be less than 50% of expected aggregate value of equity share capital at listing
Where company does not hold a controlling interest in a majority (by value) of property, fields etc. it has invested in, it must have a reasonable spread of direct interests in mineral resources, and must have influence in decisions over the timing and method of extraction of those resources.
Main Market specific listing requirements for mineral companies
*Applies to listings of equity and DRs on the Standard segment
PREMIUM STANDARD*
19
Case Study:
Source: Factset
Company profile:
The Fresnillo Group is the worlds largest primary silver producer and Mexicos second largest gold producer
The Group has five operating mines, two development projects and 5 advanced exploration prospects in Mexico
The Group has mining concessions covering a total of approximately 1.3 million hectares in Mexico.
The Groups goal is to produce 65 million ounces of silver and 400,000 of gold by 2018, through extensive investment in technology to enhance productivity and maintain low costs.
Source: Factset Listing Story: The listing raised a total of 983 million, the majority of which was new money.
In addition, the company joined the FTSE 100 in September 2008, where it remains today.
In terms of ownership structure, 22.7% of the companies shares were floated. Currently, 95.5% of these shares are held by the 20 top investors
Fresnillos performance in the market place has been superior to the FTSE 100 and FTSE 350 for Mining indices.
As of end of January 2012 Fresnillos share price was 17.75 and its market value 10.8 billion.
Company Details
Company Fresnillo Plc
Market Main Market Primary listing
Sector Mining Platinum and precious metals
Trading System SETS
Ticker FRES.L
Admission date 14 May 2008
Country of incorporation
UK
Transaction Details
Money raised at admission
1.7 billion
Market cap at admission
3.98 billion
Financial Adviser JP Morgan Cazenove
Sponsor JP Morgan Cazenove
Issue price 5.55 per share
Investor Name Value held in USD millions
Blackrock Investment Management 1,358
First Eagle Investment Management 358.7
Legal and General Investment Management 174.3
T. Rowe Price Associates 149.2
Norges Bank Investmnet Management 62.3
AGF Investments Inc 56.9
Investec Asset Management Ltd. 49.4
GAMCO Investors 46.5
AGF International Advisors Co Ltd. 38.7
Investec Asset management Pty Ltd. 38.4
Top 10 Institutional Investors January 2012
20
Case Study:
Source: Factset
Company profile:
ABG is the sub-IPO of Barrick Golds African gold assets, which include four producing mines and several principal exploration projects in Tanzania
ABGs target is to increase existing production to one million ounces per year by 2014
The companies current priorities are to bring the Upper East zone of their Tanzanian holdings into production and to continue training staff focusing on specialised skills.
ABG is headquartered in London and has regional offices in Johannesburg and Dar es Salaam
Source: Factset Listing Story:
ABG joined the Main Market in May 2010 becoming the 5th largest IPO in our markets for 2010.
Gross proceeds of the offer were intended to be used for the repayment of loans out s tand ing to the Bar r i ck Go ld Corporation and to fund its growth strategy through exploration, acquisitions and development of late stage projects.
Company Details
Company African Barrick Gold
Market Main Market- Premium Listed
Sector Mining
Ticker ABG-LON
Index Inclusion FTSE 250
Country of incorporation
UK
Transaction Details
Admission Date 19 Mar 2010
Money raised at admission
$890 m
Market cap at admission
$3.56 bn
Sponsor and joint bookrunner
JP Morgan Cazenove
Joint bookrunner Morgan Stanley
Issue price per share $8.61 /5.75
Investor Name Value held in USD millions
Legal and General Investment Management 49.48
Franklin Advisers 45.86
Invesco Trimark Investments 38.66
JP Morgan Asset Management 37.29
Van Eck Global 29.91
FIL Investments International 27.82
Wells Capital Management 18.13
Morgan Stanley Investment Management 17.22
BP Investment Management 11.72
The Boston Company Asset Management LLC 11.05
Top 10 Institutional Investors January 2012
21
Floating on AIM
The market of choice for smaller companies seeking access to international capital markets to maximise their growth potential
Access to capital
An internationally focussed, professional investor base with a deep understanding of SMEs Wide range of investors interested in SMEs including institutional and retail Ability to raise capital at admission and through further fundraisings
Balanced approach to regulation
A regulatory framework that provides local and international investors with confidence, while being accessible to companies
Disclosure and reporting obligations tailored to growing companies
Geographical reach and wide
sector coverage
Diversity of sectors, international and regional coverage Peer group comparison
Increased profile
Increased awareness and marketability of stock Increased visibility with customers, suppliers, investors and other key stakeholder
Small-mid cap network and aftermarket
support
Access to UK small-mid cap network and expertise to help companies join AIM and support them once they are trading on the market
Critical mass of advisers, analysts and investors with detailed sector expertise
22 22
AIM supports both UK and international companies seeking capital for growth
Source: London Stock Exchange trade statistics May 2012.
Statistics are based on total number of companies admitted to AIM each year by incorporation
123145
10775
102
277
177 160 162
355
519
462
284
114
36
102 90
19
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012YTD
Admissions to AIM
International UK
and enables them to raise capital throughout their life on market
Raising money on the worlds leading growth market
0.10.8 0.7 0.6 0.9
3.1
1.1 1.02.1
4.7
8.9
15.716.2
4.35.5
6.8
4.3
1.3
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012YTD
Money raised
Further bn New bn
23 23
AIM Note for Mining, Oil & Gas Companies
Guidance note sets out specific requirements, rule interpretations and guidance relating to resource companies.
It applies to resource companies, such as exploration, development and production companies but does not apply to companies which purely invest in or provide consultancy, advice or other such services to resource companies
Admission Requirements: Inclusion of Competent Persons Report (CPR)
Should be prepared by a Competent Person and detail all material assets and liabilities of the company and be reproduced in full in the admission document
Due diligence by Nomad and site visits
Nomad to conduct full due diligence on applicant and assets prior to admission.
Where assets exist outside the UK, legal advisor to produce formal opinion letter on the assets
Nomad expected to undertake site visits and conduct a physical examination of all physical assets as part of suitability assessment. Nomad to have specific internal expertise on the sector
Lock in period Exploration and development companies who have not been independent and revenue earning for at least two years must ensure all related parties and applicable employees are subject to a one year lock-in
Payments The admission document should disclose any payments aggregating over 10,000 made to any government or regulatory authority or similar body made by or on behalf of the applicant, with regard to the acquisition or maintenance of its assets
Dual listed resource companies Where a company is also admitted to trading on another exchange the AIM Rules for Companies need to be complied with irrespective of the regulatory requirements of the other exchange
Ongoing obligations:
Resource updates In each resource update the standards used in reporting should be stated. Exploration drilling updates for Oil & Gas companies should detail depth of zone tested, rock formations encountered, and information on any liquids / gases recovered
24 24
11991
2814 6
204
246
156143117
0-2m 2-5m 5-10m 10-25m 25-50m 50-100m
100-250m
250-500m
500-1,000m
Over1,000m
Median market cap = 16.2m
Market value range
Number of companies
Source: London Stock Exchange trade statistics January 2012
NB: excludes 11 currently unvalued companies and 8 suspended companies
AIM companies by market capitalisation
25 25
Case Study: Central Asia Metals plc
TIDM: CAML Admission date: 30 Sep 2010 Central Asia Metals Plc is a precious and base metals mining, exploration and development company with majority stakes in copper, gold and molybdenum projects throughout Central Asia. Central Asia Metals Plc's highly experienced management and operations team has a proven record in Central Asia, and is working towards developing its diversified base and precious metals portfolio by identifying further value-adding opportunities and projects throughout Kazakhstan, Mongolia and the rest of Central Asia.
Indices: FTSE AIM All-Share, FTSE AIM All-Share - Basic Resources
NOMAD: Canaccord Genuity Limited
Website: www.centralasiametals.com Country of incorporation (UK region): UK (London)
FTSE Sector/Subsector: Mining/General Mining
Country of main business: Kazakhstan, Mongolia
Directors: Nick Clarke, CEO; Nigel Robinson, CFO
Number of employees: 147 (FY2010)
Company story: Central Asia Metals Plc joined AIM in 2010 raising an initial $59.3m and had a market capitalisation of $132.7m. CAML has since raised over $10m in further issues and is now a top 10 company by market capitalisation on AIM in its subsector.
CAML Share Price Sep 2010 Mar 2012 Financial performance 2010 2009 2008
Revenue ($m) 1.4 1.1 2.7
Revenue growth (%) 27% -59% n/a
Net profit ($m) -5.8 -15 -13.7
Profit growth (%) 61% -9% n/a
Market capitalisation at admission
$132.7m
Market capitalisation as at 31 March 2012
$147.6m (111% growth)
Money raised at admission $59.3m
Total money raised through further issues
$13.8m
Source: London Stock Exchange trade statistics April 2012
26
(1)Source: IPREO. Please refer to the end of the presentation for legal disclaimer
The London Stock Exchange is the most international exchange in the world, with close to 600 international companies from over 70 countries, listed and traded on its markets.
We provide cost-efficient access to the worlds largest pool of international
equity assets. Over USD 1.9 trillion of equities are managed out of London, with close to USD 1.2 trillion invested in international equity assets, more than any other major financial centre.(1)
The London Stock Exchange offers a wide choice of routes to market. The choice of markets is open equally to UK and international companies, and differentiated trading platforms offer tailored solutions to maximise liquidity and investor participation.
With close to 3,000 companies quotedon its markets and over 500 member
firms,the London Stock Exchange Group operates one of the most liquid equity marketplaces globally.
Conclusions
27
Contact details
Lucy Tarleton
+44 (0) 20 7797 4672
Website: www.londonstockexchange.com
28
Disclaimer This document has been compiled by the London Stock Exchange plc (the Exchange). The Exchange has attempted to ensure that the information in this document is accurate, however the information is provided AS IS and on an AS AVAILABLE basis and may not be accurate or up to date. The Exchange does not guarantee the accuracy, timeliness, completeness, performance or fitness for a particular purpose of the document or any of the information in it. The Exchange is not responsible for any third party content which is set out in this document. No responsibility is accepted by or on behalf of the Exchange for any errors, omissions, or inaccurate information in the document. No action should be taken or omitted to be taken in reliance upon information in this document. The Exchange accepts no liability for the results of any action taken on the basis of the information in this document. All implied warranties, including but not limited to the implied warranties of satisfactory quality, fitness for a particular purpose, non-infringement, compatibility, security and accuracy are excluded by the Exchange to the extent that they may be excluded as a matter of law. Further, the Exchange does not warrant that the document is error free or that any defects will be corrected. To the extent permitted by applicable law, the Exchange expressly disclaims all liability howsoever arising whether in contract, tort (or deceit) or otherwise (including, but not limited to, liability for any negligent act or omissions) to any person in respect of any claims or losses of any nature, arising directly or indirectly from: (i) anything done or the consequences of anything done or omitted to be done wholly or partly in reliance upon the whole or any part of the contents of this document; and (ii) the use of any data or materials in this document. Information in this document is not offered as advice on any particular matter and must not be treated as a substitute for specific advice. In particular information in the document does not constitute professional, financial or investment advice and must not be used as a basis for making investment decisions and is in no way intended, directly or indirectly, as an attempt to market or sell any type of financial instrument. Advice from a suitably qualified professional should always be sought in relation to any particular matter or circumstances. The contents of this document do not constitute an invitation to invest in shares of the Exchange, or constitute or form a part of any offer for the sale or subscription of, or any invitation to offer to buy or subscribe for, any securities or other financial instruments, nor should it or any part of it form the basis of, or be relied upon in any connection with any contract or commitment whatsoever. London Stock Exchange and the London Stock Exchange coat of arms device are registered trade marks of London Stock Exchange plc. Other logos, organisations and company names referred to may be the trade marks of their respective owners.
June 2012 London Stock Exchange plc
10 Paternoster Square London EC4M 7LS
Telephone +44 (0)20 7797 1000 www.londonstockexchange.com