IPO Watch: QEM launches $5m vanadium offer ahead of ASX listing
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Vanadium is one of the resources firecrackers of the moment, making it the perfect time to try to launch a new vanadium IPO — as QEM is doing.
The price of vanadium has rocketed in the past few years, bringing big returns for stocks such as King River Copper (ASX:KRC), Australian Vanadium (ASX:AVL) and Tando Resources (ASX:TNO).
Queensland Energy and Mining, which has taken “QEM” as its new moniker, reckons it’s a vanadium pocket rocket too — with an oil shale project on the side.
QEM is offering 25 million shares to raise $5 million for a $20 million market cap.
>> Scroll down for a list of upcoming ASX IPOs
It has another $480,000 in the bank according to the prospectus.
QEM was founded in 2014 to develop a vanadium and oil shale project in the Julia Creek area of North Western Queensland.
Most of the funds ($2.8 million) will be used to develop the Julia Creek project while $2.2 million is reserved for working capital and $510,000 will go towards the IPO costs.
Vanadium + oil = the most popular kid in town
The Julia Creek project has three wholly owned exploration permits covering 176 sq km and is near the Flinders Highway and the Great Northern Railway line, which connects Mt Isa to the Townsville port.
The project has an inferred mineral resource for vanadium pentoxide of 1,700 Mt at 0.34 per cent, and a contingent 3C petroleum resource estimate of 589 million barrels.
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Mineral resources are categorised in order of increasing geological confidence as inferred, indicated or measured.
Contingent petroleum resources are known, potentially recoverable volumes with a development plan that is not yet commercial, and rated as 1C, 2C and 3C according to low, best and high estimates.
A 1C resource is a low estimate and a 3C is high.
After listing, QEM will start a drilling program and undertake engineering, feasibility and geological studies.
“We want to maintain the momentum in the development of Julia Creek and plan to do this by completing pre-feasibility studies and advancing our knowledge of the most advanced process technologies available, to maximise shareholder value,” QEM director David Fitch said in a statement.
“While QEM’s primary focus is on vanadium, developing this project will give us the distinct advantage of potentially extracting two product lines from a single resource base, once we have completed more work to establish this possibility.”
Financials
The IPO prospectus points out that QEM is a very new company and says “the entity’s ability to continue as a going concern is dependent on the success of the Public Offer”.
Revenue consists of interest and grants. A cashflow statement for the six months to December 2017 shows $15,124 cash in the kitty.
It owes $1 million via convertible notes, which will convert into equity at the IPO.
The last note was for $440,000 to the IPO lead manager Vested Equities in May, and will convert into 10 million shares.
And in April the company raised $1 million from convertible notes which will convert into 10 million ordinary shares upon listing.
The offer opens on August 14 and runs to September 10. QEM hopes to be listed by September 20.
>> Here’s a list of upcoming ASX IPOs:
| Company | ASX code | Status | Focus | Fund raising | Issue price |
|---|---|---|---|---|---|
| 1414 Degrees | 14D | Offer extended to Aug 13 | Silicon batteries | $30-50m | 35c |
| Aldoro Resources | ARN | Was due to list Aug 6 | Nickel, cobalt | $4.5-5m | 20c |
| Althea | - | tbc | Cannabis | tbc | tbc |
| AMD Resources | - | Listing delayed to end of Aug | Gold, silver | $22m | 50c |
| Andes Resources | - | Planning IPO this year; prospectus not yet lodged | Gold | $3-5m | - |
| archTIS | AR9 | Offer closes Aug 17; Due to list Aug 27 | Data security | $8-10m | 20c |
| Awati Resources | AWA | Postponed indefinitely | Gold | $4.5m | - |
| Biomics Biopharma | BBM | Delayed multiple times | China-based biotech | $13-16m | 20c |
| Calix | CXL | Listed July 20 | Water treatment | $8m | 53c |
| Candy Club | - | In pre-IPO rounds; considering float | Subscription confectionary | unknown | - |
| Carnaby Resources | - | Prospectus not yet issued | Gold | unknown | - |
| China Track | CTC | Delayed; was due to list Jun 11 | Bulldozer parts | $32-40m | 80c |
| Coolgardie Minerals | CM1 | Listing delayed to end of Aug | Gold | $4.25m | 20c |
| Constellation Resources | CR1 | Listed Jul 30 | Nickel, copper, gold | $7m | 20c |
| Corona Resources | CNA | Cancelled | Copper, gold | $6m | - |
| Cowan Lithium | - | Spin-off from Tawana. Offer open Aug 30 to Sep 27; listing Oct 8 | Lithium | $6m - 8m | 20c |
| EcoMag | Postponed to late 2018 | CleanTech | $3m | - | |
| Eden Health | ETK | Was due to list Jul 11 | Kiwi fruit-focused AgTech | $15.6 - 20m | 20c |
| Euro Manganese | - | Offer open Sep 5-18; due to list Oct 1 | Manganese | $5.2 - 8.8m | 26c |
| Frugl | Pre-IPO funding; plans Sep listing | Grocery price comparison | tba | - | |
| GeoCrystal | GDC | Listing delayed | Diamonds | $5-7m | 20c |
| Golden State Mining | - | Offer open Sep 3-28; listing Oct 12 | Gold | $4.5m - 5.5m | 20c |
| Haixi Pharma | HXP | Delayed multiple times | China-based, pain relief biotech | $25 - 30m | 50c |
| Hao Xian Yang | - | - | Beef, mutton and vegetarian meat | $1 - 1.5m | 20c |
| Identitii | ID8 | Offer open Aug 16-31; listing due Sep 19 | Blockchain | $11m | 75c |
| Kaiyun Holdings | - | Closing Oct 15; due to list Oct 29 on NSX | China-focused copper and gold | $3 - 4m | 20c |
| Keytone Dairy | KTD | Listed Jul 18 | NZ dairy powder exporter | $12 - 15m | 20c |
| Kingwest Resources | KRW | Offer closed; Listing delayed to Aug 23 | Gold | $5m | 20c |
| Kleos Space | KSS | Offer closed Jun 21; listing delayed | Surveillance satellites | $11m | 20c |
| METALS 479 | - | Cancelled | Silver | $5-7m | - |
| Moho Resources | MOH | Due to list Sep 29 | Gold, nickel, copper | $4.5-6m | 20c |
| Montem | - | Due to list Sep 27 | Canada-focused coking coal | $15-20m | 50c |
| Neuroscientific Biopharma | NSB | TBA, was due end of July | Alzheimer’s | $5-6m | 20c |
| Nicheliving | NLH | Extended to Sep 14 | Residential developer | $5-12m | 50c |
| Nickel Mines | NIC | Listing delayed to Aug 20 | Nickel | $200m | 35c |
| Norwest Gold | - | Spin-off from Australian Mines (ASX:AUZ) due to open in Sep | Gold and base metals | $2.6m | - |
| Ocean Guardian | OCG | Cancelled | Shark deterrent | $5m | - |
| OneAtom 12 | - | Due to list Aug 10 on NSX | Water treatment | $3m | 8c |
| Power Asia Limited | P88 | Offer extended | Renewable energy | $9m | 20c |
| Prospa | PGL | Postponed | small business loans | $146m | 3.64 |
| QEM | QEM | Closes Sep 10; due to list Sep 20 | Vanadium | $5m | 20c |
| Rafaella Resources | RFR | Listed July 26 | Cobalt, copper, gold | $5m | 20c |
| Raptor Resources | RPL | MIA | Lithium, copper, iron ore | $4-4.5m | - |
| Rong Yu Pharma | RY8 | Delayed | Traditional Chinese Medicine | $14-20m | 20c |
| Secure2Go Group | S2G | Postponed indefinitely | Cyber security | $4-5m | 30c |
| Spreedbox | SBX | Delayed, was due to list Jun 20 | Cloud computing | $4.2-$4.9m | 20c |
| Stirfire | SFS | Cancelled | Video games | $5-7m | 20c |
| Sultan Resources | SLZ | IPO closes Jul 27; was due to list Aug 7 | Gold | $4.5-5m | 20c |
| Tartana Resources | - | IPO suspended due to ASIC query | Zinc, copper | $5-6m | - |
| Tempus Resources | TMR | Due to list Aug 15 | Copper, gold, nickel, zinc | $5m | 20c |
| Trigg Mining | TMG | Postponed indefinitely | Potash | $4-6m | - |
| Universal Biosecurity | UBL | Delayed | Safe pest control | $5 million | 20c |
| Vintage Energy | VEN | Offer closes Aug 31; Due to list Sep 17 | Gas exploration | $30 million | 0.20 |
| Vitalharvest | VTH | Listed Aug 6 | Fruit farms | $10m | $1 |
| Zaige Waste Management | ZGZ | Delayed | China-based recycling | $14-20m | 0.2 |
