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Contango Holdings lists in London with plan to buy mining assets
November 1, 2017 / 7:02 AM / 20 days ago

Contango Holdings lists in London with plan to buy mining assets

* Implied initial market cap 1,225,000 pounds

LONDON, Nov 1 (Reuters) - Contango Holdings Plc lists on London’s junior stock market on Wednesday, after raising a million pounds ($1.32 million) from investors, with a plan to buy resources assets.

The company is the seventh new London listing in the sector this year. Although the market has begun to improve following the commodity downturn, it is still more difficult for juniors to attract investment than diversified miners.

Brian McMaster, chairman of Contango, said was he would consider any good project in the resource sector, but most likely “some kind of hard rock” as opposed to oil or gas.

Exploration budgets dried up after the commodity price crash of 2015-16 forced miners to focus on cutting costs and debt, but analysts say the mood is improving and the lack of exploration will eventually lead to shortages and boost prices.

Major miners have been missing or only just hitting output targets, but, unlike the junior exploration project companies with no income, they can benefit from higher profit margins as commodity prices rise.

Contango said in a statement that a one million pound start-up investment as part of the listing process has come from the board and other initial subscribers and it will admit a total of 42,949,987 ordinary shares, implying a market capitalisation of 1,225,000 pounds for the company.

Trading in Contango is due to begin at 0800 GMT on the Alternative Investment Market (AIM). ($1 = 0.7548 pounds) (Reporting by Barbara Lewis)

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