Appian Capital has closed its second fund (“Fund II”) for US$775m. The vehicle will be focusing on investments in metals and mining, 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 operations.
(Press Release) Fund II oversubscribed reaching $775m hard cap bringing total under management to over $1.2 billion.
-Strong investor interest reflects demand for hard assets and green commodities exposure.
-Provides exposure to copper, nickel and other base and industrial metals with a precious metals hedge
-40% already deployed using Appian’s world class global sourcing and execution capabilities
-Builds on Appian’s record of generating strong risk adjusted returns by identifying, acquiring and developing undervalued metals and mining assets
-Majority of fundraising completed remotely through COVID-19 pandemic
Team expanded to 37 investment professionals across locations in London, Toronto, Lima, Belo Horizonte and
- Sydney, overseeing nearly 5,000 employees across the portfolio
Appian Capital Advisory LLP (“Appian” or the “Company”), the investment advisor to long-term value focused private equity funds that invest solely in mining and mining related companies, today announces the final close of its second fund (“Fund II”). Fund II was oversubscribed and reached its hard cap of $775m following strong support from both new and existing Tier 1 investors globally.
Focus on core growth commodities
Fund II will pursue the same proven strategy as Appian’s first fund (“Fund I”), focusing on investments in metals and mining assets. Appian targets medium-sized assets, prioritising profitability over scale to generate maximum returns, with Fund II well positioned to benefit from demographic trends, economic growth and action against climate change.
These include the commodities used in batteries, electric vehicles and renewable power systems including copper and nickel. The Company will also employ investments in precious metals as a potential portfolio hedge.
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 operations.
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 project in Australia (which is currently at the development stage); 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.
The financial and operational expertise to deliver returns
Appian has a unique strategy that delivers outsized returns in the mining sector and limits downside risk. As a specialist private capital provider, it applies long-term value investing principles to a cyclical industry and remains highly disciplined, focusing on high margin, low cost assets with a high-quality resource base where there is the potential to add value.
The Company’s unique in-house technical and investment expertise allow 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.
Appian’s strong culture of accountability allows it to maintain the highest environmental, social and governance standards across all operations and investments, and the Company has established a Charitable Foundation to support the regions in which its operations are based. Appian has a strong Advisory Board comprised of leading individuals from the mining, financial and commercial sectors.
Strong track record
Following the success of Fund I and the investments already made from Fund II, Appian’s portfolio is well diversified. It invests in equity, credit and royalties across the capital structure, and importantly where its industry leading technical and financial teams are able to assist the underlying management teams to create value.
Appian has an excellent track record with very strong risk-adjusted returns delivered to date. It has made nine investments, with six mines in production and a further two expected to be producing within 24 months. The Company has also completed or announced four successful exits, including Avanco Resources which owns one of the highest grade open-pit copper mines and was sold to Oz Minerals.
Michael W. Scherb, Founder and CEO of Appian, commented:
“We are incredibly pleased to have closed Fund II, reaching our hard cap with the fund oversubscribed, and appreciate the support for our unique operating model and investment approach. Our Tier 1 investors value our combination of technical and financial expertise that allows us to identify, acquire and develop undervalued assets. Meanwhile, our management teams benefit from our long-term capital and support in enhancing their development plans to boost returns. 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.”
About Appian Capital Advisory LLP
Appian Capital Advisory LLP is the investment advisor to long-term value focused private equity funds that invest solely in mining and mining related companies.
Appian is a leading investment advisor in the metals and mining industry, with global experience across South America, North America, Australia and Africa and a successful track record of supporting companies to achieve their development targets, with a global operating portfolio overseeing nearly 5,000 employees.
Appian has a global team of 37 investment professionals with offices in London, Toronto, Lima, Belo Horizonte and Sydney.