Triple Flag’s scrapped $360-million IPO shows investors still not buying gold rally – by Gabriel Friedman (Financial Post – December 12, 2019)

The amount of equity raised by the mining sector has declined for several years, but broadly speaking it has also been a difficult time for IPOs

The streaming and royalty company Triple Flag Precious Metals Corp. on Wednesday cancelled its initial public offering, the clearest sign yet that financing conditions in the mining and metals sector have not caught up with rising gold prices.

The company had hoped to raise $360 million on the Toronto Stock Exchange by selling 20 million shares at $15 to $18 apiece in one of the biggest offerings in the Canadian mining sector in years, but analysts said the company likely could not hit its desired target.

Founded in 2016 by Shaun Usmar, a former Barrick Gold Corp. executive who received backing from the New York hedge fund Elliott Management Corp., Triple Flag invests in mining projects in exchange for a share of the revenue or production. Such companies generally are considered less risky than actual mining companies because their portfolio is often diversified across regions, metals, and management teams, among other factors.

The cancellation came after a roughly two-week road trip around North America, and London, to promote the offering to potential investors.

In a statement, Triple Flag said, “while the company has been encouraged by investor interest in its proposed initial public offering (IPO), the market environment for share offerings, particularly near year-end, continues to be challenging.” A spokesperson declined to comment.

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