Skip to main content

The Globe and Mail

Resource Capital hires syndication specialist for mining deals

TomasSereda/Getty Images/iStockphoto

Resource Capital Funds, a private-equity firm that invests in mining assets, has hired a syndication specialist to help pull together entire financing packages for miners.

"The real potential value to be created in this market is to be the catalyst to bring the financing, the entire package together," Denver-based Resource Capital partner Ross Bhappu told a mining conference in Toronto on Wednesday.

Joining forces with other private equity firms such as Houston-based Denham Capital Management LP would allow the funds to bring more firepower to the table.

Story continues below advertisement

The handful of private-equity firms dedicated to the mining industry are competing with banks and other stock market investors, which are more traditional sources of capital for the mining industry.

The new syndication specialist's "whole role is to help us put these deals together, work with other groups like a Denham, like others out there that would be willing to come in and co-invest with us," he said.

The level of interest in private equity was high at the Prospectors and Developers Association of Canada conference, where miners were hoping to attract much-needed investment. Funding in the sector has become scarce with the slump in commodity prices.

The smaller miners, particularly the ones not yet in production, were hit the hardest when investors dumped mining stocks last year.

Rock-bottom stock values combined with more interest from private-equity firms created unrealistic expectations that private pools of capital would quickly step in and fill the funding void. But that has not happened even though there is about $1-trillion in private-equity funds ready to be invested.

Resource Capital's Mr. Bhappu said he was looking at three areas: assets that the bigger mining companies are trying to divest, projects that are ready for construction, and early-stage companies that would normally raise capital on the Toronto Stock Exchange.

"We see [them] as a great opportunity for private equity," he said.

Story continues below advertisement

Report an error Licensing Options
About the Author
Economics Reporter

Rachelle Younglai is The Globe and Mail's economics reporter. More

Comments

The Globe invites you to share your views. Please stay on topic and be respectful to everyone. For more information on our commenting policies and how our community-based moderation works, please read our Community Guidelines and our Terms and Conditions.

We’ve made some technical updates to our commenting software. If you are experiencing any issues posting comments, simply log out and log back in.

Discussion loading… ✨

Combined Shape Created with Sketch.

Combined Shape Created with Sketch.

Thank you!

You are now subscribed to the newsletter at

You can unsubscribe from this newsletter or Globe promotions at any time by clicking the link at the bottom of the newsletter, or by emailing us at privacy@globeandmail.com.