Drought cracks barren earth, kind of like ASX’s IPO market right now. Source: Adobe Stock
The Market Online - At The Bell

Join our daily newsletter At The Bell to receive exclusive market insights

Drought-like conditions defining the ASX IPO market look well entrenched, with an IPO from private Pacific State falling over this week.

Seeking to raise a paltry $5.5M at 20cps for an Australian listing, the company couldn’t find enough buyers – despite boasting “potential large copper [and] base metal and gold deposits.”

While it’s true there’s already enough copper and gold projects to throw money at, the failure to list does point to a worrying environment. Especially given this is Australia, and that both metals are sufficiently vogue through 2024.

Usually, hype is enough to garner funding. But – based on a fairly limited and abrupt update – it appears that investors aren’t feeling risk-on.

ASX-listed proposed partner on the deal, S2 Resources (ASX:S2R), announced the news about Pacific State on Monday. It had previously been gearing up for an asset transaction with Pacific State once listed.

That, of course, is now dead in the water. The culprit? “Adverse market conditions.”

(This sounds a lot like Telix’s excuse for ditching its NASDAQ listing just last week, despite market conditions in the US being pretty fantastic right now.)

“Pacific State has been unable to complete an Initial Public Offering by the agreed date of 30 June 2024,” S2R wrote on Monday.

“As a result of this, Pacific State and S2 have agreed to terminate the agreement entered into in August 2023.”

That agreement saw S2R intending to pawn off its Fraser Range and West Murchison projects to Pacific State. No longer is that the case.

S2R has sold off its stake in Pacific State and is now “reviewing exploration plans to unlock … intrinsic value” in the projects.

The question is, of course, why it wanted to sell them in the first place.

S2R last traded at 11cps.

S2R by the numbers
More From The Market Online
The Market Online Video

ASX Market Update: Bourse surrenders gains | 19 July 2024

The ASX is down 1% as the market falls back below 8000 points after record highs…
The Market Online Video

ASX Market Close: Index finishes the week lower | 19 July 2024

In market close this afternoon we are discussing Droneshield, Universal Store Holdings, Flynn Gold, Lifestyle Communities,…