Baker Steel Resources Trust, set to float in London around the second half of April, said it had received a positive response from investors for its planned listing and 70 million pound ($106.4 million) share placing. "We have had a very good response so far in the first week of marketing," Trevor Steel, chief investment officer, told Reuters in an interview on Friday. "We have had significant commitments already."
Baker Steel Capital Managers LLP, a specialist natural resources investment manager, said earlier this month it planned to float Baker Steel Resources Trust to offer investors exposure to pre-initial public offering (IPO) mining stocks and specialist listed resources opportunities.
The trust is the first of its kind in the UK and hopes to benefit from the around 30 to 40 percent uplift in valuations between private and public companies, Steel said. The creation of the new investment company comes amid a pickup in IPOs in the resource sector. On Friday, African Barrack Gold priced its IPO at 575 pence, valuing the company at $3.6 billion.
The offer period for Baker Steel Resources Trust will run until the second week in April and the trust is looking at the third week as a probable listing date, Francis Johnstone, a partner at Rock Capital and member of the Baker Steel team, told Reuters. The trust, which has assets under management of about $61 million, will list on London's main market at a likely valuation of between 100 million pounds and 150 million.
The trust has an investment team of five who have a strong technical background in mining as well as experience in finance that enables the company to carry out its own due diligence and technical evaluations of potential opportunities. It has assets world-wide in iron ore, coal, copper, nickel, platinum, uranium, phosphate and gold and plans to increase its exposure to platinum group metals. It will use the placing to raise its holdings to about 10-15 core assets. Its biggest assets by value at the moment are a 0.8 percent interest in Brazilian iron ore company Ferrous Resources and a 2.1 percent stake in Ivanhoe Nickel and Platinum Ltd (IvanPlats).
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