Australia's Indophil still studying IPO on PSE

by Miguel R. Camus, BusinessMirror

Posted at Mar 19 2013 08:31 AM | Updated as of Mar 19 2013 04:38 PM

MANILA, Philippines - Australian mining company Indophil Resources NL, owner of 37.5 percent of the massive-but-undeveloped Tampakan gold-copper project in Mindanao, continues to study a potential introductory listing on the Philippine Stock Exchange (PSE) after plans fell through in 2012, an official said.

Gavan Collery, Indophil vice president for corporate affairs, declined to comment on a specific timetable for the listing but he noted that progress toward this end could be made within the year.

Indophil, which is already listed on the Australian Securities Exchange, announced plans to list on the PSE in 2011. However, the plan was overtaken by several events in 2012, including difficulties experienced by Tampakan operator Sagittarius Mines Inc. to obtain the necessary environmental permit as well as declining commodity prices.

“Once we have completed our own due diligence which includes preparation of various PSE-required documents and information, it is Indophil’s intention to seek PSE listing,” Collery said in an e-mailed response to the BusinessMirror on Monday.

“We would expect to progress that action during the course of this calendar year. The timing of an outcome would be subject to PSE acceptance of our listing request, once lodged,” he added.

A listing by way of introduction differs from an initial public offering as funds are not immediately raised. By using this route, a firm can have its shares traded on the exchange, giving it much-needed exposure, without the risks associated with equity capital raising.

Collery added that the company continues to have sufficient funding to meet its “scheduled obligations” to develop the Tampakan project. It is estimated to have 15 million tons of copper and almost 18 million ounces of gold, potentially making it the largest mine in the country and fifth-largest copper mine worldwide.

“On the current schedule, that commitment comes in the form of a Declaration of Mining Feasibility involving all the project partners including the Philippine government, and that DMF is slated for some time in 2014,” Collery said.

“If approved, construction is slated to start in 2015 and first production in 2019,” he said.

The much-delayed environmental compliance certificate for the Tampakan project was signed in February although this will only be granted to Sagittarius Mines upon the latter’s compliance with certain conditions, reports showed.

Nonetheless, outstanding issues remain mainly an open-pit mining ban in South Cotabato, where part of the Tampakan project is situated. Investors are also waiting to see how the government can resolve confusing and overlapping local government and national ordinances affecting the project.

Indohpil’s single-largest shareholder group is the Alcantara-led Alsons Group, which owns close to 20 percent, followed by Xstrata Queensland Ltd., which holds 13.06 percent, data provided by Indophil showed. Smaller Philippine-based shareholders are Manuel V. Pangilinan-led Philex Mining Corp. (with 2.4- percent equity interest) and San Miguel Corp. (with 4 percent).

Indophil, which has a market value of about A$420 million, holds its Tampakan interest through a 37.5-percent interest in Sagittarius Mines; the remaining 62.5 percent is held by another mining powerhouse Xstrata Plc.