Business

Cathal Friel-chaired green metals company hires broker for London IPO

Flotation of Irish-run company could take place as soon as March

Serial entrepreneur Cathal Friel is chairman of European Green Metals

Joe Brennan
Wed Jan 31 2024 - 06:00

European Green Metals (EGM), a company chaired by serial entrepreneur Cathal Friel focused on exploring for rare metals needed for the green energy transition is planning to float on London’s junior market, according to sources.

The firm has hired UK investment bank Panmure Gordon to manage the initial public offering (IPO), which could come as soon as early March, the sources said.

It would mark the fifth IPO that Mr Friel’s Raglan Capital corporate finance business has orchestrated in the space of a dozen years.

EGM’s main shareholders are Mr Friel and fellow director Michael Nolan, co-founder of Fastnet Oil & Gas, which Raglan brought to AIM, the London Stock Exchange’s market for small companies, in 2012.

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It is not yet clear how much EGM, which was founded three years ago and led by chief executive Aiden Lavelle, a geologist by background, aims to raise in an IPO. A spokesman for EGM declined to comment on what he called “market speculation” when asked about the plan.

EGM currently has three exploration projects – one in Germany and two in Sweden – for critical metals such as lithium, used for electric vehicle batteries, and rare earth metals like dysprosium and terbium, used in the manufacture of wind turbines.

An EU law aimed at boosting supply from within the union of minerals crucial for its green and digital transitions – and end its reliance on Chinese supply – is on track to enter force this year, subject to the European Council approving a final text agreed by the European Parliament last month.

The EU’s demand for base metals, battery materials, rare earths and more are set to increase exponentially as it moves away from fossil fuels and turns to clean energy systems which necessitate more minerals.

It is understood that EGM also plans to look at investing opportunistically in other green transition assets – particularly focusing on viable distressed assets that need to be turned around – as it looks to develop a portfolio.

A number of the other companies that Raglan oversaw the flotation on the stock market over the past 12 years have created value through acquisitions of distressed assets.

Fastnet Oil & Gas spun off its oil and gas assets in 2015, following a slump in oil prices. However, Mr Friel subsequently managed a merger in 2016 of what was then a listed cash shell company with Amryt Phrama, which was looking to buy and develop a pipeline of drug candidates focused on treating rare and orphan diseases. The deal was essentially an IPO as it involved a €12.6 million stock offering.

Amryt was acquired for about $1.48 billion (€1.37 billion) last year by Chiesi Farmaceutici, an Italian pharmaceutical company.

Mr Friel orchestrated the IPO of Open Orphan, a pharma services company, in 2019 through the reverse takeover of Dublin-listed Venn Life Sciences. The company went on later that year to buy UK clinical trials business Hvivo, which was struggling at the time. The since-renamed Hvivo group currently has a market value of €205.5 million.

Hvivo spun out its Poolbeg Pharma unit, which is focused on developing treatments for infectious diseases, in 2021 through an IPO in London of the division that raised £25 million (€29.2 million). Poolbeg’s market capitalisation stands at £41.5 million (€48.5 million).

Joe Brennan

Joe Brennan

Joe Brennan is Markets Correspondent of The Irish Times

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