Sunday, July 14, 2024

Discovery Metals to list on LSE

Discovery Metals Limited, the junior mining company listed on the Australian and Botswana Stock Exchanges, is to shore up its image by listing on the London Stock Exchange’s (LSE’s) Alternative Investment Market to raise cash for its Botswana operations.

Discovery Metal’s Managing Director, Jeremy Read said Thursday that the company has lodged its “pre-admission announcement” for the purposes of trading on the lucrative LSE’s Alternative Investment Market. The move comes just weeks after the company announced better than expected inferred copper reserves at its operations at Dikoloti and Maun’s Zeta sites.

“By listing on AIM, Discovery will gain access to one of the most successful global stock markets for the financing of emerging companies and to a range of institutional investors with long histories of investing in Africa resource companies,” he said.

The move by Discovery Metals got an all rounded applause from leading local resource sector brokerage-firm, Capital Securities Botswana, which said that the move will give a face-lift to Discovery Metals as well as realize the current shareholders’ value in the organization.

The Thursday announcement lifted up the Discovery Metals share price as investors quickly digested the news and it went two thebe up to 135 thebe on slightly over 7 million shares while on Friday over 27,000 shares exchanged hands at 10 thebe better to reach 155 thebe.

In Australia, it rose two cents, to 30.5 cents, as punters were eyeing the possibility of the injection of the British pounds sterling into the life blood of the company.

“LSE is another avenue to raise capital in the future. It is a very prestigious market and it will help in raising the profile of the company,” Gregory Matsake, a trader at Capital Securities Botswana said.

He added: “It also comes with another class of investors from another (developed) market.
“It will also give the local investors an avenue to sell and realize the value of their investment,” he added.

The local price move was largely pushed by institutional investors and the thinking in the city is that the price upward move which is expected to continue up to the end of the month might drive a lot of institutional investors’ decision.

Read, said in a statement on Thursday that they are expecting the London AIM listing to broaden their investor base to include those in the United Kingdom and the rest of continental Europe. That will provide the necessary flexibility to form future capital raising that might be required for Maun and Dikoloti ÔÇô near Tobane ÔÇô operations.

According to the latest updates released by the company, the inferred resource has been increased to 31.6 million tonnes at 1.3 percent copper while a higher grade zone of 14.3 million tonnes at 1.7 percent has been defined within the Zeta inferred mineral resource. It further stated that given the new development the economic model of the Maun Project is currently being revised while Dikoloti resources is currently valued at around US $ 100 million per annum given the current base metal prices.

“With a stable political environment, well established regulatory code, a skilled workforce and sound infrastructure, Botswana is an extremely attractive country in which to participate in the development of mineral resources,” Read added.


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