Canadian geothermal firm pumps up $100m IPO

Canadian geothermal firm Magma Energy last week announced that it is set to raise around C$100m (£52m) after pricing its Initial Public Offering (IPO) of 66,667,000 common shares at C$1.50 each.

Initial indications are that the IPO, which is scheduled to close on July 7, is oversubscribed and the company said that it had granted its underwriters an over-allotment option, enabling the purchase of an additional 10,000,050 common shares at the C$1.50 price.

The company said that if the over-allotment option is exercised in full, the total proceeds from the IPO will reach C$115m.

The company already has one geothermal power plant operational in Nevada and the new funds are expected to support a significant expansion drive, built around four sites where advanced exploration has already taken place, and a further 14 early-stage exploration projects in North and South America.

Magma is now expected to be listed on the Toronto Stock Exchange under the ticker symbol MXY.TO.

The company had originally anticipated raising just C$50m through its IPO, and the deal is evidence of growing interest in clean-tech IPOs in general, and the geothermal sector in particular.

The Obama administration recently earmarked $84m in stimulus funding for new geothermal research projects.