In a move guaranteed to warm the hearts of advocates for increased local content in the extractives industry, Asante Gold Corporation – a Canadian gold exploration, development and operating company with interest in the Kubi, Bibiani and more recently Chirano gold mines – has obtained regulatory approval to list 315 million shares on the main board of the Ghana Stock Exchange (GSE).
Listing the company, which is also listed on the Canadian Securities Exchange and the Frankfurt Stock Exchange, was done by introduction — a listing procedure whereby outstanding shares are listed without the issuing of new shares. It comes almost six months after the exit of another Canadian mining firm, Golden Star Resources, from the local market following its acquisition by Chifeng Jilong of China.
Offering their rationale behind the move, Chief Executive Officer of Asante Gold Corp., Dave Anthony, said it is to provide domestic investors with an increased opportunity to own a viable business in a critical sector of the economy.
“The reason for listing is to provide an opportunity for Ghanaian investors to participate in the future growth of Asante Gold,” he said.
The company further pledged not to initiate moves for delisting for a minimum of three years from the date of listing
He added that the development is consistent with the philosophy of Asante Gold – to give priority to the communities where it operates; explaining that since it began operations in 2012, the bulk of its workforce has been local.
In an accolade to the local workforce, Mr. Anthony said the company is “poised to pour gold within the next 10 days. This is a testament to the skills and capacity of Ghanaian industry and logistics, its service providers, engineers, project managers and tradespeople”.
In his remarks, Managing Director of the GSE, Ekow Afedzie, said the first listing on the Accra bourse in almost two years provides an opportunity for new and existing investors to participate in the market, boosting market liquidity as a consequence.
“The listing of Asante Gold will provide more liquidity for existing shareholders, and perhaps in the future more shares will be listed. In addition, when presenting other investors in Ghana and outside renewed investment opportunities, it is important that Ghanaians participate in building the economy through investments in key sectors,” he explained.
The GSE boss expressed optimism that Asante Gold’s listing will spur the market on and signal to other viable businesses the benefits of listing on the Accra bourse. He also indicated that work is underway to introduce the Derivates and Over-The-Counter (OTC) markets within the next three years.
On his part, CEO of the Chamber of Mines, Sulemanu Koney, described Asante Gold’s listing as a watershed moment for the extractive industry in the country – as it is the first time in its pre-production phase a company has extended the opportunity for increased local ownership through the stock market.
“This vote of confidence in Ghana’s mining sector could attract other multinational mining companies, and thereby increase the number of listed firms. It is my considered view that a partnership between the mining industry and local capital market could unlock the vast potential of our mineral resources to accelerate the country’s development and shared wealth,” he said.
To further deepen the capital market, he raised a call for reviewing the statutes which limit the proportion of pension funds that could be invested in stocks
“If pension funds from offshore investors are used to provide capital for multinational mines operating in Ghana, why can we not replicate similar arrangements in Ghana?” Mr. Koney quizzed.
Asante Gold’s Bibiani Mine is expected to produce more than 230,000 oz per year, with plans of extending the mine beyond initial estimates of eight years. It maintains aspirations of transitioning from an exploration company to a Tier-1 mining company.
Its shares began trading with the ticker (ASG) at GH¢8.87 per share.
