NEW YORK: For decades, the risky world of early-stage mining ventures was the playground of institutional funds and commodity trading houses.
But after a more than 900% rally in a little-known Canadian potash developer last year, a new class of investors is moving in – family offices.
Millennial Potash Corp has attracted a group of ultra-high-net-worth clans that are increasingly bypassing traditional funds to take direct stakes in critical resources.
Potash, a potassium-rich salt, is a fertiliser for crops ranging from cereals to potatoes, helping boost yields and plant resilience. The miner is developing a potash project in Gabon and has no other revenue.
“We have actually seen very unusual interest coming from family offices,” said its chairman Farhad Abasov. “Usually, we don’t see a lot of this capital coming into the junior mining sector.”
The investment push is led by The Quaternary Group, a Singapore-based investment entity representing Ross Hamou-Jennings, the former Asia chairman of Cargill Inc, the commodities and agriculture giant.
Quaternary owns roughly 25% of the potash miner, and Hamou-Jennings is using his industry knowledge to bridge a valuation gap he identified in the company.
He views potash as an essential, US$30 bil niche market where global powers, such as the United States and China, lack self-sufficiency. The United States added potash to its list of critical minerals in November, boosting Millennial’s shares.
The Banio project plans to use the deep-water port at Mayumba, along the west coast of Africa. That will allow shipments to reach major markets like Brazil while bypassing traditional choke points, according to Millennial’s website.
The company maintains a market value of C$281mil.
SCP Research rates the stock a “buy,” banking on Abasov’s proven track record at Potash One and Allana Potash to drive the next phase of growth. — Bloomberg
