GobiMin Inc. V.GMN

Hong Kong Listing

[nozzpack]

Hong Kong has a sophisticated capital market and is well-known for its savvy investment community.

However, the robust liquidity and high P/E ratios on the Hong Kong Stock Exchange (“HKSE”) are counter-balanced by higher transactional costs and stricter listing requirements (including a three-year track record period and one-year ownership continuity) than those of the Toronto Stock Exchange (“TSX”) and TSX Venture Exchange (“TSX-V”).

Nevertheless, the HKSE is taking steps to attract foreign listing candidates that have cogent connecting factors to Asia and China, particularly companies in the mining sector.

To induce mining and resource companies to seek listings on the HKSE, the new Chapter 18 Rules relax some of the most stringent profit and cash flow tests which had effectively prevented all but the most mature mining companies from listing.

Chapter 18 now requires applicants to control at a minimum “indicated resources”, possess 125% of working capital for the 12 months following listing, be led by a board of directors and management with at least 5 years relevant industry experience, and demonstrate a “clear pathway to production”.

In my view, GMN should easily meet those conditions should its next major asset be in the mining sector, especially in China.

It also has as one of its larger shareholders a multi national mining company with a listing on the HK exchange.

Such a listing would transform GMN , as it could if needed, raise substantial funds .

Just a guess on my part.