TMX says junior miners retain cashraising appetite

Mon Dec 5, 2011 12:39pm EST
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By Clara Ferreira-Marques

LONDON (Reuters) - The Toronto Stock Exchange, home to the largest number of mining companies globally, has seen capital raising in the sector remain resilient this year despite volatile markets, with a "strong" pipeline ahead, a senior executive said on Monday.

The exchange -- home to more than 1,600 miners, many of them junior exploration companies -- has seen the sector raise C$10.9 billion ($10.7 billion) in the year to October on the venture exchange and main market.

That compares with C$11.2 billion in the same period a year ago.

"It has been slower, but not by much ... To put this in context, the mining index is down about a third," said Ungad Chadda, senior vice-president of the Toronto Stock Exchange, whose remit includes all aspects of listings.

"It speaks to the resilience of our marketplace, and to the stage of development of our companies. We have a lot of exploration and development companies that have certain milestones and maintenance obligations."

Chadda, speaking on the sidelines of a mining conference in London, said roughly half the capital raised this year was done so on the venture exchange, home to emerging companies. The vast majority was raised via secondary listings.

"A lot of these companies are so junior that they need to raise capital even to maintain interest levels. Unfortunately it has been a little bit more dilutive," he said.

The Toronto exchange stretches from tiny early-stage companies to heavyweights such as Barrick Gold (ABX.TO: Quote), the world's largest gold miner, but is best known as a venue for junior firms, particularly in the exploration space.   Continued...