July 25, 2000 The National Post
Eureka! There's life among juniors
'This shows you can still raise money for mining in Canada'
Scott Adams
National Post
Moribund since the Bre-X Minerals blow-up, the junior speculative mining sector is showing signs of life on the Toronto Stock Exchange.
Wallbridge Mining Co. is set to go public today, raising $12-million for exploration of properties mainly near Sudbury, Ont. The company -- which, according to president Wayne Whymark, thinks it can find ore in Sudbury "that will make Voisey's Bay look tiny" -- priced 5.8 million common shares at $1.50 share and 1.9 million flow-through shares at $1.70 a share. It also has cleared raising another $2.6-million through special warrants.
The deal was led by Dominick & Dominick Securities Inc., Griffiths McBurney & Partners and Dundee Securities Corp. Dominick mining analyst Alan Ferry said about 70% of the deal sold to institutions and 15% was sold overseas.
Canada, once arguably the world centre for junior mine exploration companies, saw just 22 new metals and mining issues on the TSE in 1999, raising $15.8-million, compared with 61 new issues in 1997, raising $1.79-billion.
Wallbridge set out to raise $8-million to $15-million, said Mr. Whymark. "This shows you can still raise money for a mining company in Canada."
Wallbridge's deal is fairly small, but it shows that the environment for junior miners is better than last year partly because of a rebound in commodity prices.
"I tip my hat," said John Ing, president of Maison Placements Canada Inc. "It's tough to do mining deals."
But investors shouldn't expect to see a rebirth of issues like the Wallbridge one.
People close to the deal said it was attractive because no other junior exploration companies have accumulated property around Sudbury, home to one of the three largest geological nickel areas in the world. The area has been dominated by Inco Ltd. and Falconbridge Ltd.
Wallbridge, which was founded four years ago, has a portfolio of 150 square kilometres of property near Sudbury. Its holdings include four joint ventures with Falconbridge, which will also have a 2.5% stake in Wallbridge after the offering. Wallbridge also has property in Duluth, Minn. |
