Law firm and LSE eye surge in African mining floats this year

LAW FIRM Pinsent Masons is eyeing a surge in IPOs from Africa-focused mining companies this year, as it teams up with the London Stock Exchange to woo African miners to raise finance in the capital.

Following a visit last month to Mining Indaba – a mining investment conference in Cape Town – dealmakers at the law firm yesterday said sentiment was encouraging for African miners looking to raise capital in London.

As a result, Pinsent Masons is predicting a “significant uplift” for the mining IPO market this year, as institutional investors seek to expand their commodity portfolios, with London remaining the most attractive market.

Earlier this month, South African platinum miner Tharisa Minerals became the latest African-focused digger to turn to the London market as it hired Macquarie and HSBC to lead a float that would see the company valued at around $300m (£198m).

“The London exchanges provide access to institutional investors who have deeper pockets and often more of a long term investment strategy,” Paul Amiss, a corporate partner at Pinsent Masons, said yesterday.

“Other international exchanges might be suitable for junior explorers at an early stage of their exploration and development, but viable junior mining companies who may produce in the near term are likely to target London as that is where the institutional finance is.”

Amiss said that the pipeline is particularly encouraging for the second half of the year, as he is seeing “increasing expressions of interest” for IPOs of companies that are listed elsewhere, but want a dual listing in London to accelerate expansion plans.