(This story has been posted on The Wall Street Journal Online's Deal Journal Australia blog at http://blogs.wsj.com/dealjournalaustralia.)
By Stephen Bell
Africa-focused gold explorer Papillon Resources Ltd. saw its shares nearly triple in value on the Australian Securities Exchange last year, outpacing many of its rivals in what's been a tough 12 months for miners.
But that won't stop new Papillon CEO Mark Connelly investigating whether it makes sense to list in Canada as well, as the Perth-based group weighs up longer-term funding options for its Fekola gold discovery in Mali.
"We're always looking at these opportunities and if the conditions are right we'd pursue it further," Mr. Connelly told Deal Journal Australia.
"Currently we are comfortable with the Australian listing that we have. But Papillon is getting to the scale now where it's got a bigger profile, and we've had quite a few approaches from people in North America interested in the story," he said.
The strong gains this year have driven Papillon's market value to around 438 million Australian dollars (US$459 million) -- even though it is likely years away from producing any gold from Fekola, a 3.1 million-ounce deposit in Mali, West Africa.
A dual listing in North America would offer Papillon more liquidity, broader recognition and a bigger pool of investors to tap for future capital raisings, said Mr. Connelly, who added that Papillon currently has around A$20 million in cash.
This should be sufficient to complete a prefeasibility study on Fekola by the middle of this year, Mr. Connelly added.
A North American listing is not necessarily a "slam dunk" due to the extra administration costs and the need to have a permanent presence in Canada, he said.
However, the Canadian market does tend to be quicker than the ASX in closing out merger and acquisition deals, he said.
Mr. Connelly, who became chief executive of Papillon in November, was previously chief operating officer of West African Gold miner Endeavour Mining Corp. following its merger last year with Adamus Resources Ltd. where he was managing director.
Prior to any Toronto listing, Papillon would seek to pick up extra coverage from Canadian banks or brokers, he added.
RBC Capital Markets, a unit of Royal Bank of Canada, already publishes research on Papillon. "And we've had other approaches from Canadian brokers and investment banks to pick up the story as well over time," he said.
PIR Price at posting:
$1.64 Sentiment: LT Buy Disclosure: Held
