Investment adviser Appian Capital Advisory’s second fund was oversubscribed and reached its hard cap of $775-million following strong support from both new and existing Tier 1 investors globally.
Called Fund II, the fund will pursue the same proven strategy as Appian’s first fund (Fund I), through focusing on investments in metals and mining assets.
Fund II will invest on a global basis, targeting assets in jurisdictions with proven geology, supportive governments and a robust legal framework including Brazil, Australia, Mexico, Peru, Chile and Canada, where Appian has existing assets.
Fund II is already 40% deployed or reserved in five investments, demonstrating Appian’s strong global sourcing and execution capabilities.
These include equity investments in Mineração Vale Verde’s copper/gold development asset, in Brazil, and Kalbar Operations’ Fingerboards mineral sands development project, in Australia; a royalty investment in Atlantic Nickel’s operating Santa Rita nickel/copper/cobalt asset, in Brazil; and both royalty and credit investments in Harte Gold’s producing Sugar Zone mine, in Ontario, Canada.
Additionally, Fund II has significant capital available to pursue larger co-investment opportunities, and the company says its unique in-house technical and investment expertise enables it to identify undervalued opportunities in the sector.
The financial team has experience from leading investment banks and private equity firms, having completed over $200-billion of mining transactions, while the technical team is comprised of industry professionals from major mining companies who have brought over 60 mines into production.
“This allows us to apply the technical sophistication of a major mining house to smaller operations, reducing development and operating costs and bringing forward production to boost returns,” the company says.
Through Fund I, Appian has made nine investments, with six mines in production and a further two expected to start production within the next two years.
CEO Michael Scherb says the company’s management teams benefit from the company’s “long-term capital and support in enhancing development plans to boost returns”.
He added that Fund II is “well positioned” to benefit from its exposure to high-growth segments of the global economy, through commodities that will "enable the transition to a low carbon economy and infrastructure development to generate strong, risk-adjusted returns”.