GREATER VALUE

Mexico 2019 | FINANCE | INTERVIEW

TSX and TSXV anticipate more companies coming out of Mexico as the environment continues to evolve and as they ramp up their efforts to do more in the region.

Loui Anastasopoulos
BIOGRAPHY
Loui Anastasopoulos is President of Capital Formation at TSX and TSXV. He is responsible for TMX Group’s listings business, along with global business development and relationship management. He previously served as CEO of TSX Trust Company, where he provided leadership to TMX’s corporate trust and transfer agency business.

How many Mexican companies are listed on TSX and TSXV, and how much growth do you foresee in the next year?

Mexico is our most robust market in Latin America in terms of equity capital raised and is still our primary focus. Notably, we saw five new mining companies with properties in Mexico list on our exchanges in 2018, like Avino Silver and Orla Mining. These companies had no problem raising funds. That investor support is another reason why Mexican companies continue to look at Canada as a place to raise capital. We have 126 companies with properties in Mexico listed between our two markets and have raised approximately USD410 million in equity capital. In terms of growth, we continue to see Mexico as one of our key markets.

What areas of opportunity has TSX identified from the change of administration?

We are observing the transition carefully because Mexico is a key jurisdiction. We continue to make investments not just in Mexico, but in the broader Latin American region. We recently hired someone on the ground in Brazil who can also address the broader Latin American market. We have heard different things as everyone in Mexico is still trying to get some clarity on the country's future direction. Mining is something we have been focused on, but we have also been encouraged by developments around energy deregulation over the past few years. We are watching closely to see how those policies will move forward under President Andrés Manuel López Obrador because we see a major opportunity in the energy sector. If that window opens in Mexico, we see a great opportunity for us to bring some companies and opportunities to Canada and have them raise capital and potentially go public as well.

What advantages does TSX offer companies with projects in Mexico compared to other exchanges globally?

We are known as the world's leading global mining exchange. We list nearly 50% of all the public mining companies in the world. Our 2018 financing statistics show that 49% of all global mining financings were completed on our markets. This has to do with the ecosystem in Canada. We have a vibrant community of lawyers, bankers, and broader stakeholders who understand the resource industry because it has evolved here over 150 years. Equally important is the broad investment ecosystem that knows how to value resource companies and the regulatory framework under National Instrument 43-101 that allows companies to be valued based on their inferred resources. As a result, companies can drive higher valuations and, therefore, raise capital more freely. We also have a large retail investing community that is somewhat unique to Canada. Most average people in Canada have trading accounts and actively participate in these mining and resource companies.

What strategies is TSX using to grow its presence in other industries in Mexico?

Our focus continues to be primarily mining and energy in Mexico. We also work with the consulate on a number of initiatives. As things evolve, we will look at whether we require further investment in Mexico. We are open to other opportunities, but there is no formal strategy or investment as heavy as in Mexico's mining and energy sectors. Notably, Mexico begins to look interesting when you consider the growth of the cannabis industry. We see a huge opportunity as that industry starts to evolve because we have solidified and positioned ourselves as the global marketplace for cannabis. We have raised nearly USD12 billion in that sector over the last five years with 50 companies listed on our market, and we don't see that slowing down. We have some listed companies on TSX and TSX Venture that are doing business with companies in Mexico relating to cannabis. We have shown that Canada is a great market that is really supportive of financing the cannabis industry.