TMAC Resources Inc launches $105 million IPO – by Peter Koven (National Post – June 2, 2015)

The National Post is Canada’s second largest national paper.

TORONTO — Canada’s initial public offering craze is finally seeping into the mining sector, as TMAC Resources Inc. has launched the sector’s first significant IPO in many months.

The Toronto-based company, which is named after its well-known executive chairman Terry MacGibbon, is planning to raise $105 million, according to a preliminary prospectus filed with regulators. TMAC’s underwriters plan to sell 52.5 million shares at $2 each, with an option to sell up to 7.875 million additional shares if demand is strong enough. The stock will list on the Toronto Stock Exchange.

TMAC owns the Hope Bay project in Nunavut, a massive undeveloped gold deposit. U.S. gold giant Newmont Mining Corp. acquired the project for $1.5 billion in 2007, but was never able to put forward a good development plan and eventually wrote it down. That paved the way for TMAC, an upstart company, to acquire it in 2013.

Last month, TMAC completed a pre-feasibility study on Hope Bay that projected a capital cost for the project of $206 million. The study found that the mine would have a net present value of $626 million at a gold price of US$1,250 an ounce.

MacGibbon was a former senior executive at Inco Ltd. in Sudbury who later founded his own company, FNX Mining Company Inc. FNX eventually merged with Quadra Mining Ltd., and the combined company was sold to the Polish company KGHM Polska Miedz SA for nearly $3 billion.

TMAC’s two big investors are Newmont Mining and Resource Capital Funds, which own 37 per cent and 38.7 per cent of the stock respectively, according to the prospectus.

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