London has fallen behind New York, Toronto, and Sydney as a global venue for mining company listings. Investors warn it risks being “sidelined” by a sector it once dominated if major groups head overseas. The market capitalization of London-listed mining stocks has shrunk to $272 billion this year from $322 billion in 2018. Rival bourses in Australia, Canada, and the US now each have mining sectors worth more than $325 billion, according to S&P Global Market Intelligence.
More money is being raised abroad than in the UK: London Stock Exchange-listed miners have raised just $8 billion since 2020, less than a quarter of the amounts raised in Sydney and Toronto. While London chases after high-growth technology company flotations, it risks losing its historic edge in a global resources sector, a natural listing venue since the British empire.
The mining sector’s importance has grown in recent years due to its role in providing critical minerals for cleaner energy. Robert Crayfourd, portfolio manager at CQS, stated, “The market is focused on the tech sector, but it is important that London, historically an innovative and supportive center for mining stocks and mining finance, does not pull back further.”
From the late 19th century, London attracted large mining companies from the British empire. Currently, 171 metals and mining companies are listed on the LSE, accounting for 17% of the world’s market capitalization for the sector. However, most of the value resides in a few large companies like Glencore, Rio Tinto, and Anglo American, with over 100 having a market capitalization of less than £100 million.
In 2022, London suffered as Russian gold producers delisted following the invasion of Ukraine, and BHP moved its primary listing to Australia. Activist investors are pressuring Rio Tinto to follow suit, while Glencore considers spinning off its coal division to be listed in New York, and Anglo American is selling assets. Losing Anglo or Glencore is a “huge risk for the London market,” said Hayden Bairstow, an analyst at Argonaut.
The shift away from London is driven by higher valuations and deeper liquidity in the US, which attracts larger Canadian-listed groups. Companies often find investors outside Europe less demanding on environmental, social, and governance measures. The popularity of diversified miners in London has waned, as investors prefer companies producing higher growth metals like copper for the green transition.
London’s top five miners have an enterprise value of 5.2 times their core earnings, compared to 9.4 times in Canada and 6.8 in the US. The slump in China’s property market has affected Australia’s top five miners, trading at 4.9 times core earnings. Canada and Australia benefit from thriving domestic mining sectors that attract local pension fund investments. African mining, traditionally a focus for London, is now dominated by Chinese companies, more likely to list in China or Hong Kong.
