Business Irish

Monday 18 November 2019

Zinc firm eyes Canada for autumn flotation

Group Eleven Resources’ Bart Jaworski
Group Eleven Resources’ Bart Jaworski
Gavin McLoughlin

Gavin McLoughlin

Irish-focused zinc explorer Group Eleven's planned flotation will take place in Canada, with the company aiming to execute the deal before the end of the year.

Group Eleven CEO Bart Jaworski told the Irish Independent that the company aims to float in the autumn, at a price "in excess" of CAD$0.30 a share (€0.20).

He added that he would like to establish a listing in Dublin in future if it made sense.

"The reason to go to Canada is that Vancouver is really the capital of the junior resource market in the world. But if it made sense for us, I'd love to be listed in Dublin at some stage, in the not-too-distant future," Mr Jaworski said.

Last week, the company announced it had agreed a deal to buy 60pc of a prospect which covers areas of Co Longford and Co Westmeath.

It is buying the asset known as the Ballinalack prospect from Canadian mining giant Teck. The other 40pc of the prospect is owned by a Chinese company. The asset is located 50 kilometres west of Europe's largest zinc mine at Navan in Co Meath.

Group Eleven raised CAD$3.8m (€2.6m) to finance the deal via a private placement of new shares at CAD$0.30 each. On that basis, the company is valued at more than CAD$14m (€9.5m) on a fully diluted basis - meaning share options that have not yet been converted into shares are included. It paid Teck in cash and shares, and Teck now has a 7pc stake in the company on a fully diluted basis.

Among the participants in the fundraising for the Teck deal was MAG Silver, a listed Canadian explorer with a market capitalisation in excess of CAD$1.3bn (€880m), which had previously invested in Group Eleven, whose other backers include former Davy corporate finance chief Hugh McCutcheon.

The move will represent a further boost for the Irish zinc sector. There has been a marked increase in activity, the price of zinc having soared over the past 18 months. Glencore has recently re-started drilling work on an asset at Pallas Green in Limerick, after activity had ceased for a number of years.

Canadian-listed Hannan Metals has started drilling at a prospect in Kilbricken in Co Clare, while there has been interest in buying Teck's part of another Limerick prospect, Stonepark. The other part is owned by John Teeling's Connemara Mining. In addition, Unicorn Mineral Resources has told shareholders it is in talks about selling itself to a Canadian-listed company.

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