McMullen Back with New SPAC
MAC team back together in a big week for mining raisings
The team behind MAC Copper has raised US$230 million for new company Metals Acquisition Corp II (NYSE: MTAL.U).
MAC II, a special purpose acquisition company, raised US$200 million via the issue of 20 million units at US$10 per unit, while lead book-runner Cohen & Company Capital Markets and co-manager Jett Capital Advisors acquired 3 million units after exercising their over-allotment option in full.
Each unit comprises one Class A ordinary share and one-third of a redeemable warrant, with each whole warrant exercisable to purchase one Class A ordinary share at a price of US$11.50 per share.
MAC II also closed a private placement of 5.06 million warrants at US$1.50 per warrant to sponsor MAC Partners, advisor Sternship Advisers, Cohen & Company and Jett to raise US$7.6 million.
Its shares will eventually trade under the code MTAL in New York, which was the same ticker as its predecessor company Metals Acquisition Corp.
Metals Acquisition Corp became MAC Copper after acquiring the CSA copper mine in New South Wales from Glencore in 2023.
MAC was acquired by Harmony Gold (JSE: HAR) late last year for US$1.03 billion.
Like its predecessor, MAC II will seek business combinations and acquisitions in the natural resources sector with a focus on critical and strategic minerals in “high-quality, stable jurisdictions”.
MAC II is led by Mick McMullen as executive chairman, who ran MAC Copper and was recently linked to the Barrick Mining Corporation (NYSE: B) top job, prior to the permanent appointment of Mark Hill.
The Australian-born geologist also ran Detour Gold Corporation, taking it from a struggling C$2.1 billion company to a C$4.9 billion takeover by Kirkland Lake Gold in just seven months.
McMullen also ran Stillwater Mining Company, doubling its market capitalisation prior to its US$2.2 billion acquisition by Sibanye Gold, now Sibanye-Stillwater (JSE: SSW).
Former MAC Copper chief financial officer Morné Engelbrecht is CFO of MAC II, while MAC Copper general counsel Chris Rosario is senior vice president and general counsel.
Former MAC Copper chair Patrice Merrin and director Anne Templeman-Jones will sit on the MAC II board alongside Stikeman Elliott partner Jay Kellerman.
“We believe our team’s distinctive and complementary backgrounds can have a transformative impact on a target business,” MAC II said in its prospectus.
“Our team will deploy a proactive, thematic sourcing strategy and will focus its efforts on companies where we believe the combination of our operating experience, transaction execution capabilities, professional relationships and capital markets expertise can serve as catalysts to enhance the growth potential and value of a target business and provide opportunities for an attractive return to our shareholders.
“Our management team’s strong experience in mergers and acquisitions and operations is expected to enable our company to identify and execute on value accretive business combinations for our shareholders that would benefit from access to the deep and highly liquid US public markets.”
Other investors cashing up
On Monday, Orion Resource Partners announced the successful final close of Mine Finance Fund IV, its flagship strategy dedicated to providing comprehensive and tailored financing solutions for the construction and acquisition of strategic metals and critical mineral assets.
Fund IV closed at approximately US$2.2 billion, making it the largest fund raised to date by Orion.
The fund attracted commitments from a highly diversified global investor base, including pension funds, sovereign wealth funds, and other leading institutional investors.
Fund IV is already 61% committed across a portfolio of projects, spanning North and South America, Europe, Australasia, and Africa.
The final close of Fund IV brings Orion’s total assets under management to well over US$9 billion.
Meanwhile, in Australia, L1 Group (ASX: L1G) has launched L1 Gold Fund, which is expected to list on the ASX next month.
The company opened an offer this week, targeting A$500 million to A$1 billion from investors.
L1 Gold Fund is a closed-end, three-year investment vehicle predominantly focused on gold equities, with opportunistic investments in other precious metals and will be managed by L1 Capital’s co-founders and co-chief investment officers Rafi Lamm and Mark Landau.
“We will typically have 8-12 high-conviction positions in the fund, targeting specifically the mid-cap gold and silver stocks, predominantly in Australia and North America,” Lamm said.
“Using L1’s traditional approach in the mining space, we’re going to focus on companies that are very undervalued, both in absolute and relative terms, particularly companies where we can see strong production growth, improving cost structures and a near-term free cashflow inflection that is likely to trigger a re-rating.”
The fund will employ an active hedging strategy and will seek to short some of the larger gold stocks when valuations are stretched, as well as companies with a risk of near-term underperformance.
Two of L1’s top picks are Eldorado Gold (TSX: ELD) and Westgold Resources (ASX/TSX: WGX).
“L1 has been actively involved in the mining space generally, and the gold space specifically, since inception, almost two decades ago, and over the last year, L1 gold holdings have outperformed the GDX index by over four times,” Lamm said.
“We believe the macroeconomic outlook for gold is particularly strong at the moment and the sector is generally very undervalued versus history and versus the broader market.
“Finally, we have identified a portfolio of gold companies that are very undervalued but also have a very attractive set of catalysts to emerge over the next six to 12 months.”