Lacklustre performances by small mining companies on the London Stock Exchange are driving rivals in need of cash to find alternative ways to raise capital, either by merging or turning to other markets such as Toronto.
Six small miners have listed in London this year, up from two last year, but four of those are now trading below their offer price despite a rally in metals, led by a 27-per-cent jump in copper and aluminium prices and a 10-per-cent rise for gold.
London hosts the world’s biggest mining companies, including Rio Tinto Ltd. and BHP Billiton Ltd., but the poor performance of newly listed miners and other small miners trading in London is pushing some to change their plans.
On Tuesday, Condor Gold, a Nicaraguan gold miner whose share price is down 10 per cent this year, said it had received conditional approval for a secondary listing in Toronto, where it hopes valuations will be higher.
“London is not a great place to be listed as a junior explorer. There is not a clear understanding of what we do,” said Mark Child, the company’s chairman and chief executive officer.
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