LONDON/JOHANNESBURG (Reuters) – Ghana, Africa’s largest gold producer, is planning an as much as $500 million itemizing of its gold royalty fund in London in October, although the deal may nonetheless run into political opposition, three sources accustomed to the matter advised Reuters.Agyapa Royalties, a government-backed fund that holds fairness pursuits together with mining royalties within the state’s gold property, has employed Bank of America BAC.N and JPMorgan JPM.N to pursue an preliminary public providing (IPO) on the London Stock Trade this yr, the sources stated.Royalties are funds that give the proprietor the suitable to obtain a proportion of manufacturing from a mining operation, or retain a stake in them.Ghana needs to benefit from the dear metallic’s sturdy efficiency this yr to boost $400 million-$500 million from the IPO, the sources stated. The fund’s shares will even be listed on the Ghanaian Stock Trade.Nevertheless, the itemizing may very well be derailed or pushed again due to resistance from Ghana’s principal opposition social gathering forward of a December common election, the sources stated.“It’s genuinely 50-50 at the moment, but if the local politics works out, the deal is ready to go this year,” stated one of many sources.The itemizing gives a chance to boost funds with out growing the nationwide debt burden, Ghana’s deputy minister for finance Charles Adu Boahen stated, and capital raised will probably be invested in infrastructure, training, well being, and housing.In written solutions to Reuters’ questions, Adu Boahen dismissed the opposition Nationwide Democratic Congress’s criticism of the itemizing and stated Agyapa Royalties’ registration in Jersey is for tax effectivity.“The Opposition is saying many things, which is understandable considering this is an election year,” he stated. “Agyapa does not seek secrecy and… will comply with international corporate governance standards.”JP Morgan declined to remark whereas Bank of America didn’t instantly reply to a request for remark.If it goes forward, the itemizing would profit from a surge in gold costs because the COVID-19 pandemic pushed buyers into safe-haven investments. Whereas the spot gold price has come off a file excessive hit in August, it’s nonetheless up a whopping 27% to date this yr at $1,931 an oz. XAU=. Canadian firms Yamana Gold and Wheaton Valuable Metals have each signalled their intention so as to add a London itemizing this yr. For London buyers, it is a chance to extend gold publicity and probably fill the hole left by South Africa’s Randgold, which delisted in 2018. The deal would additionally come at a time when the marketplace for IPOs has come roaring again after a dismal first half of the yr, with The Hut Group THG.L sealing a 5.four billion pound ($6.99 billion) float final week.Reporting by Abhinav Ramnarayan, Clara Denina and Helen Reid; enhancing by Emelia Sithole-Matarise and Hugh Lawson
