Skip to main content
The Globe and Mail
Support Quality Journalism.
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); } //

Hundreds of explorers and small miners have flocked to the Toronto Stock Exchange and the Toronto Stock Exchange Venture because they are friendly to the industry and an easy place to raise capital. But the landscape is shifting.

TomasSereda/Getty Images/iStockphoto

South Africa, Australia and London are trying to convince more mining companies to list on their exchanges, an effort that poses a threat to Canada's dominance with junior miners.

Hundreds of explorers and small miners have flocked to the Toronto Stock Exchange and the Toronto Stock Exchange Venture because they are friendly to the industry and an easy place to raise capital. But the landscape is shifting as Canada's competitors make a bigger effort to attract mining companies.

"For a long time there was a perception that if you listed in North America, you would attract a higher multiple. But that's not the case anymore," said Eddie Grieve, senior manager of the Australian Securities Exchange's listings business development.

Story continues below advertisement

Mr. Grieve describes the rivalry between the Canadian and Australian exchanges as friendly, as the two countries have similar resource-based economies and histories of mining.

The Australian exchange started targeting Africa about five years ago and it has paid off. According to Mr. Grieve, ASX dominates in Africa, where there are around 209 companies with African projects on his exchange, compared with about 177 on the Toronto bourses.

This is painful fact for the South African bourse, which enjoys top rankings from the World Economic Forum but only has 71 listed miners. "South Africa is endowed with minerals. We should be the mining mecca for the African continent and the fact is we're not," Noah Greenhill, a representative of the Johannesburg Stock Exchange, said.

Mr. Greenhill and Mr. Grieve were in Toronto last week to talk to prospective issuers at the Prospectors and Developers Association of Canada conference.

Mr. Greenhill said Canada is a premier destination for miners to list because it has been building the financial infrastructure around mining for decades.

Unlike South Africa, where the bulk of metal exploration was historically handled by senior producers like Anglo American, thousands of Canadians have been exploring for minerals for years.

The Canadian miners have had to tap public markets for funding, which has conditioned investors to accept risks associated with mining.

Story continues below advertisement

It has also created deeper pools of capital as well as an industry dedicated to helping miners raise money.

Canadian banks like BMO Nesbitt Burns, Royal Bank of Canada and GMP Securities have a long history of serving the mining industry through good times and bad.

"They stick with mining even when the appetite drops," said Al Gourley, who works with explorers and miners globally as co-head of Fasken Martineau law firm's mining group in London.

"Other banks, they tend to dip into the industry when times are great. When times are not so great, they leave absolutely and they do this by disbanding their mining teams," he said.

That has allowed Canada to maintain its competitive edge in the recent commodity downturn.

Although the Toronto exchanges are the smallest in terms of market capitalization, they are ahead when measured by listed mining companies. The Toronto exchanges are home to 1,612 mining companies. Australia lists about 860 miners. The London exchanges list 181 and the JSE 71.

Story continues below advertisement

Toronto suffers in market capitalization because there are no mining powerhouses headquartered or listed in Canada. When big Canadian miners like Inco, Falconbridge and Alcan were taken over by foreign companies, their stocks were delisted.

Rio Tinto, which bought Alcan, is listed in London, Australia and New York. Glencore Xstrata, which bought Falconbridge, is listed in London, South Africa and Hong Kong. And Vale, which bought Inco, is listed in New York among other places.

One of the world's largest gold producers, Australian-listed Newcrest Mining Ltd., asked to be removed from the TSX last year because it did not think the Toronto listing would deliver significant value.

That puts London and Australia on top in terms of value. Mining companies on the London Stock Exchange and AIM are worth $308-billion (U.S.) Miners on the Australian exchange are valued at about $308-billion.

On the Johannesburg Stock Exchange, they are worth about $252-billion and the combined market cap of miners on the TSX and Venture exchange is $242-billion.

The London Stock Exchange said its location combined with the city's sophisticated financial services industry are a huge draw for mining companies.

Story continues below advertisement

"Geographically, we can go south, we can go east, we can go west in terms of listed companies," said Alexander Lehmann, who spends most of his time with issuers as the exchange's head of capital markets in the Americas.

The TMX Group, which owns the two Toronto exchanges, said even though the London exchange attracts mining giants, it does a better job of covering the whole spectrum.

According to the TMX Group, there were just over 1,400 financings on the Toronto exchanges last year. The London Stock Exchange group said there was a total of 46 mining equity transactions on AIM and its main market last year. "We don't see our competitive advantage slipping but it's very important to stay on our toes," said Kevan Cowan, head of equities at the TMX Group.

"We always take all competition very seriously," he said.

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow the author of this article:

View more suggestions in Following Read more about following topics and authors
Report an error Editorial code of conduct
Tickers mentioned in this story
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies