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Fresnillo - Mexican gold and silver miner

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One to watch, planning a main market listing in London.

 

LONDON (Thomson Financial) - Mexico's Industrias Penoles S.A.B. de C.V. will spin off its precious metals assets into the Fresnillo Group and plans to list the company on the main market of the London Stock Exchange in May.

 

Fresnillo, the world's largest primary silver producer, is estimated to be worth about $8 billion and is a potential FTSE 100 candidate.

 

Proceeds from the new shares in the initial public offering, expected to be about $900 million, will be used by Fresnillo to re-pay existing debt and to finance expansion plans.

 

The company did not disclose possible proceeds from the sale of existing shares. However implied proceeds of about $1 billion can be estimated as Penoles said it expects to retain about three quarters of the company following the offering.

 

Fresnillo, Mexico's second-largest gold producer, produced about 34.4 million ounces of silver and approximately 280,000 ounces of gold in 2007 and aims to double silver output within the next 10 years and increase its gold production.

 

http://www.forbes.com/markets/feeds/afx/20...afx4879386.html

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One to watch, planning a main market listing in London.

 

I am definately keeping an eye out on this one. If it makes the ftse 100 there should be demand from tracker funds etc to purchase the stock and this should boost the price also. Could someone please post on here where we can get a prospectus from and when it is released as I have a feeling there may be a high demand for this and we will need to get in quick.

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I am definately keeping an eye out on this one. If it makes the ftse 100 there should be demand from tracker funds etc to purchase the stock and this should boost the price also. Could someone please post on here where we can get a prospectus from and when it is released as I have a feeling there may be a high demand for this and we will need to get in quick.

It's possible that it will not be available to the retail investor and you will have to buy once it comes to market. Will have to try and find out.

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Mexican to join FTSE 100 invasion

Evening Standard

11 April 2008, 1:47pm

The landslide of giant foreign mining concerns floating on the London stock market is about to see yet another company that few investors have heard of being included in the FTSE 100 index.

 

The world's largest silver mine, Fresnillo, located in Mexico, is set to list up to a third of its shares in London in an offering that could value the company at up to £4bn.

Depending on the timing of the float, the state of the stock market and the current soaraway price of silver, Fresnilla could be in the Footsie by the summer.

 

If Fresnilla gets into the blue-chip index, it would just be the latest major overseas concern to join, threatening to weight the FTSE 100 ever further toward the natural resources extractive sectors - mining and oil - and to companies with very little, if any, link to the British economy.

 

Yesterday, New World Resources, a giant Silesian coal mining concern, firing up the steelmaking boom in central and eastern Europe, said it aims to float soon in London.

 

Its initial public offering could see it valued at up to £4bn, big enough for it to join the Footsie.

 

 

 

I'm also watching this and would appreciate any info as to how to jump on board.

 

Riggers

 

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Mexican to join FTSE 100 invasion

Evening Standard

11 April 2008, 1:47pm

 

Fresnilla could be in the Footsie by the summer.

 

If Fresnilla gets into the blue-chip index, it would just be the latest major overseas concern to join, threatening to weight the FTSE 100 ever further toward the natural resources extractive sectors - mining and oil - and to companies with very little, if any, link to the British economy.

 

Yesterday, New World Resources, a giant Silesian coal mining concern, firing up the steelmaking boom in central and eastern Europe, said it aims to float soon in London.

 

Its initial public offering could see it valued at up to £4bn, big enough for it to join the Footsie.

 

 

Riggers

 

This is an interesting point in terms of the effect on the FTSE if the index becomes top heavy with mining, energy and oil companies that are in a bull market. The FTSE 100 will then not be representative of the UK economy, but a segment of it and some of the companies will essentially be foreign in everything they do. Another reason why the FTSE may not actually fall much, although as in the Tech boom the volatility of mining shares may see some big one day falls in the index when they are in an overbought and corrective phase asthey often fall 10-20% quickly. Right now, it is the FTSE miners that are holding the index up. I think they are due a correction which may coincide with this IPO.

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This is an interesting point in terms of the effect on the FTSE if the index becomes top heavy with mining, energy and oil companies that are in a bull market. The FTSE 100 will then not be representative of the UK economy, but a segment of it and some of the companies will essentially be foreign in everything they do. Another reason why the FTSE may not actually fall much, although as in the Tech boom the volatility of mining shares may see some big one day falls in the index when they are in an overbought and corrective phase asthey often fall 10-20% quickly. Right now, it is the FTSE miners that are holding the index up. I think they are due a correction which may coincide with this IPO.

 

This is an interesting point. I do agree that in the short term a correction may we be on the cards in the mining secor and may take Fresnillo with it. The FTSE will become alot more volatile but in the long term I think the FTSE will be supported by these companies. If there is a sell off this will provide a good buying opportunity.

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This is an interesting point. I do agree that in the short term a correction may we be on the cards in the mining secor and may take Fresnillo with it. The FTSE will become alot more volatile but in the long term I think the FTSE will be supported by these companies. If there is a sell off this will provide a good buying opportunity.

And that's what I'm looking for. They look stretched to me right now, but if other recent FTSE mining IPO's are anything to go by, Fresnillo will fly at some stage. Look at Eurasian Natural Resources(ENRC).

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And that's what I'm looking for. They look stretched to me right now, but if other recent FTSE mining IPO's are anything to go by, Fresnillo will fly at some stage. Look at Eurasian Natural Resources(ENRC).

And look what happened today.

 

Eurasian Natural Resources (ENRC) 1,311.00p +8.71%

 

When this one goes, it rockets. You don't need to be in the more risky junior sector to make quick profits from these miners. Just a pity I didn't get in yesterday. :lol::(

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LONDON, April 24 (Reuters) - Fresnillo Ltd, the world's top silver producer, set an indicative price range of between 555p and 700p per share for its $2.2 billion London Stock Exchange IPO on Thursday, according to sources close to the deal.

 

The Mexican precious metals firm, which launched bookbuilding on Thursday, is offering $900 million worth of new shares.

 

Parent firm Penoles, which will retain a stake of 75 percent to 77.3 percent of Fresnillo after the initial public offering, is selling as much as $1.3 billion worth of existing shares.

 

The company and Penoles have agreed a lock-up period of one year.

 

Bookbuilding will close on May 8, with pricing expected on May 9.

 

http://uk.reuters.com/article/ipoNews/idUK...24?rpc=401&

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On a day when just about everything is falling, Fresnillo was up 9p. Considering that it will go into the FTSE 100 the institutions and trackers will be buying, so I would have thought that it is likely to go much higher. One to watch and DYOR.

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I was hoping for the shares to be released around the time that the Silver price bottoms but it looks we mat have missed the lows at $16. A retest of the lows would be nice to coincide with the IPO.

Do we know the release date yet?

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Robbie 'Naked Trader' Burns is onto these!

With a price target of 750 (currently 560).

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Could be going into the FTSE100 soon. Should benefit from institutional buying, FTSE tracker buying, etc.

 

As we all know, the mining companies dominate the FTSE 100 at the moment, meaning the leading index is hardly representative of the UK economy. That dominance looks likely to increase following next week's quarterly index changes.

 

According to the Edinburgh Tracker team at Aberdeen Asset Managers, three new companies could join the FTSE 100, two of which are miners.

 

The Czech coal group New World Resources is likely to be included, provided it satisfies all of London's listing requirements, as is Mexican silver miner Fresnillo. The non-miner on the verge of entry is engineer Invensys.

 

Under threat of demotion are Argos and Homebase owner Home Retail Group, mortgage bank Alliance & Leicester and housebuilder Persimmon.

 

http://blogs.guardian.co.uk/markets/2008/0...l_know_the.html

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Could be going into the FTSE100 soon. Should benefit from institutional buying, FTSE tracker buying, etc.

 

But not just yet? Although it's time will come.

 

"two of the biggest London share offerings this year are not eligible for inclusion in the index. Trading in Fresnillo, the Mexican silver miner valued at £3.97bn, has only been possible for 19 days, rather than the necessary 20 so it must wait until the next quarterly reshuffle in September to be included".

 

But here's yet another resources stock going in.

 

"The colonisation of the FTSE 100 by foreign resources companies will continue this week when Ferrexpo, the Ukrainian iron ore producer, is catapulted into the blue chip index.

 

A market capitalisation of around £2.68bn will place it at around 80th in the rankings of the largest UK companies".

 

http://www.telegraph.co.uk/money/main.jhtm...8/cnftse108.xml

 

 

 

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But not just yet? Although it's time will come.

 

"two of the biggest London share offerings this year are not eligible for inclusion in the index. Trading in Fresnillo, the Mexican silver miner valued at £3.97bn, has only been possible for 19 days, rather than the necessary 20 so it must wait until the next quarterly reshuffle in September to be included".

 

http://www.telegraph.co.uk/money/main.jhtm...8/cnftse108.xml

Kept out on a technicality, well spotted on that one.

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Been seriously hammered by the market in recent days now 505, missing out on FTSE promotion must be one reason, but is gold and silver really no longer that popular given this sell off. :lol: Markets, don't you just love them?

 

Looks well oversold now.

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Been seriously hammered by the market in recent days now 505, missing out on FTSE promotion must be one reason, but is gold and silver really no longer that popular given this sell off. :lol: Markets, don't you just love them?

 

Looks well oversold now.

 

Watching this one like a hawk. It's now trading at about 485. I didn't think I'd see it go below 500 as there must be a lot of big boys who bought this when it floated.

 

With a lack of information about, it's hard to work out the 'true value' of this stock. Who knows how low it will go?

 

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Watching this one like a hawk. It's now trading at about 485. I didn't think I'd see it go below 500 as there must be a lot of big boys who bought this when it floated.

 

With a lack of information about, it's hard to work out the 'true value' of this stock. Who knows how low it will go?

Agree on the 500, I actually expected it to go higher, but almost as soon as the date passed of the FTSE re-shuffle and it didn't get in by not meeting the 20 day requirement, the price has bombed. Has to be a short sellers attack. This price fall is silly.

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This price fall is silly.

 

Or is it...

 

(From ADVFN's FRES thread (http://uk.advfn.com/cmn/fbb/thread.php3?id=17121071&from=1))

weemonkey - 21 May'08 - 12:38 - 17 of 57

 

seem expensive on market cap to sales ratio

 

comparison with Hochschild who I suppose are their only true comparitor on FTSE

 

fresnillo turnover/sales 2007 $647 million dollar (£330M)

hochschild turnover/sales 2007 $305 million dollars(£155M)

 

Fresnillo market cap £4 billion approx

Hochschild market cap £1 billion approx

 

Fresnilo price to turnover ratio 12

 

Hochschild price to turnover ratio 6.45

 

well which one is cheaper?

 

on face value you are squeezing double the sales per share from Hochschild

 

one (or both) look overvalued.

 

am biased though I hold hoc

 

if they were both horses Fresnillo carrying more weight I would say.

 

think the froth could come off this very fast

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Or is it...

 

(From ADVFN's FRES thread (http://uk.advfn.com/cmn/fbb/thread.php3?id=17121071&from=1))

weemonkey - 21 May'08 - 12:38 - 17 of 57

 

seem expensive on market cap to sales ratio

 

comparison with Hochschild who I suppose are their only true comparitor on FTSE

 

fresnillo turnover/sales 2007 $647 million dollar (£330M)

hochschild turnover/sales 2007 $305 million dollars(£155M)

 

Fresnillo market cap £4 billion approx

Hochschild market cap £1 billion approx

 

Fresnilo price to turnover ratio 12

 

Hochschild price to turnover ratio 6.45

 

well which one is cheaper?

 

on face value you are squeezing double the sales per share from Hochschild

 

one (or both) look overvalued.

 

am biased though I hold hoc

 

if they were both horses Fresnillo carrying more weight I would say.

 

think the froth could come off this very fast

 

I will explain what I mean by "silly".

 

I think that had Fresnillo gone into the FTSE 100 the share price probably would have gone up. With the general market falls of the last week or so, it would have suffered as well, but there would have been institutional buying. Quite a few of us got caught out by the 20 day requirement, which I believe probably set the stage for a short sellers attack. I'm guessing, and cannot confirm it, but the price fell quickly over the course of 2-3 days once it failed to make the FTSE 100. Some were clearly in the know on the 20 day rule and it got slaughtered. It doesn't matter, it goes in the FTSE 100 next time and I noticed one broker, UBS, set a 600 price target the other day.

 

However, what I think you also need to consider is that Fresnillo and Hochschild are operating in a bull market for what they produce, therefore fundamentals can and do get stretched. Remember the tech boom, junior gold miners now and anything that is in a bull market, often like for like comparison means little except on something that is clearly undervalued compared to something else. The bull will pull them up. As Eric King recently said on FSN, if you are buying into a bull market and nothing has changed on fundamentals, the bull will get you out of trouble if the share price happens to fall after you have bought.

 

You may be right on Hochschild and I own some, it may be undervalued compared to Fresnillo and due a rise on the back of the bull market for silver. And, as if by magic, today we see it go up 399.25p +6.47%. These are the kind of moves you get on a regular basis for the FTSE miners. I think it can go much higher, especially if silver hits $25-$30 this year. Fresnillo will go up as well on the that rise.

 

I wouldn't worry too much about such comparisons as long as you feel that the fundamentals are right for both. In fact, if you find one that is clearly undervalued, the bull should serve you well over time.

 

 

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At £4.80 the stock is now looking very cheap I would be surpised if it goes much lower than this.

Who knows? On the day Hochschild goes up by over 6%, you would expect a reasonable move in Fresnillo. The shorters probably still want their pound of flesh.

 

LONDON, June 25 (newratings.com) - Analysts at Canaccord Adams initiate coverage of Fresnillo Plc (FNL) with a "hold" rating. The target price is set to 5.60p.

 

In a research note published this morning, the analysts mention that the company’s dividends for FY08 are likely to account for 33%-50% of after-tax profits. Investment demand, inflation, credit issues and the dollar weakness are likely to persist in the gold and silver markets going forward, the analysts say. The company is unlikely to witness a jump in its production before 2011, Canaccord Adams adds.

 

http://www.newratings.com/en/main/company_...ne.m?id=1766286

 

Looks busy to me.

 

MAG Silver Reports First Resource of 237.8 Million Ounces Silver on the Valdecanas Vein

 

In addition, resources of 480,000 ounces gold and 1 billion pounds of combined lead and zinc

 

MAG Silver Corp. (TSX: MAG)(AMEX: MVG) ("MAG" or "the Company") announces a resource estimate from the Juanicipio Joint Venture located in Zacatecas State, Mexico. The operator of the Joint Venture, Fresnillo plc ("Fresnillo"), has informed and provided MAG with a resource estimate for the Valdecanas Vein as presented below. MAG and Fresnillo operate the project at Juanicipio through their joint venture company, Minera Juanicipio S.A. DE C.V. ("M. Juanicipio"). MAG holds a 44% interest in the Juanicipio Joint Venture. The total inferred resource estimate is 237.8 million ounces of silver of which MAG's 44% interest equates to 104.5 million ounces and Fresnillo's 56% interest equates to 133.2 million ounces. In addition to the silver, the resource estimate also contains inferred resources of 480,000 ounces of gold and almost 1 billion pounds of combined lead and zinc (457,700 tonnes).

 

http://money.cnn.com/news/newsfeeds/articl...ire/0408171.htm

 

VANCOUVER, BRITISH COLUMBIA--(Marketwire - June 10, 2008) - International Northair Mines Ltd. (TSX VENTURE:INM) and its wholly owned subsidiary Grupo Northair de Mexico, S.A. de C.V. ("Northair" or the "Company") is pleased to announce that it has signed binding agreements, subject to regulatory approval, with Fresnillo PLC ("Fresnillo"), a subsidiary of Industrias Penoles, S.A. de C.V. ("Penoles"), to form a joint venture on Northair's La India Project, located in the State of Durango, Mexico. Northair is very pleased to join forces with the Penoles Group who are aggressive mineral explorers and operate some of the largest and richest precious metal mines in Mexico.

 

Fresnillo has informed Northair that exploration on the project has commenced with surface geological mapping, sampling and definition of drill targets. An initial drill program is planned.

 

http://www.marketwire.com/press-release/In...INM-866581.html

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