Nikanor becomes AIM's largest float

Nikanor, a copper and cobalt miner in the Democratic Republic of Congo, is set to become the largest company at the time of flotation on London's AIM.

The company announced yesterday it had raised $400m (£222m), despite the volatile market conditions which have led to several flotations being pulled. The listing will give Nikanor an initial stock market value of $1.5bn. The company's broker, JP Morgan Cazenove, believes that valuation is the largest of any company on entry to AIM, though others have raised more money.

Most of the funds raised will be used to develop three brownfield, open-pit copper and cobalt mines in the Democratic Republic of Congo's copper belt, including the huge KOV project which the company calls "the highest grade major ore body in the world".

Jonathan Leslie, the executive chairman of Nikanor, said: "We are particularly pleased with the quality of the shareholder base. Their investment will contribute towards realising the significant potential inherent in our remarkable asset base and accessing the mineral wealth of the Democratic Republic of Congo."

The reserves at KOV, in the southern Katanga province, are 6.8 million tonnes of copper, the company estimated. That would be equivalent to more than a third of the current global copper use each year. At full operating capacity - some six years from now - it will be producing 250,000 tonnes of copper and 25,000 tonnes of cobalt a year.

Prior to the listing, Nikanor is 25 per cent-owned by Congo's state miner Gecamines and 75 per cent-owned by GEC, a company set up by the Israeli businessman Benny Steinmetz and the diamond dealer Dan Gertler.

The shares, which listed at 600p, closed at 635.5p yesterday, the first day of trading.

Gecamines halted production at KOV in 2000 due to a lack of investment. Nikanor will also operate two smaller mines.