Pierre Lassonde's mining story
Pierre Lassonde's mining story
When Pierre Lassonde learned that Newmont was looking to divest itself of Franco-Nevada in 2007 - the company he had founded in 1983 and sold in 2001
When Pierre Lassonde learned that Newmont was looking to divest itself of Franco-Nevada in 2007 - the company he had founded in 1983 and sold in 2001 for $3.2 billion - he jumped at the opportunity and bought it back for $1.3 billion.
Pierre Lassonde's story is one of ambition, innovation, and an unwavering commitment to the mining industry. Born in St-Hyacinthe, Quebec, Lassonde embarked on a path that would ultimately lead him to become a prominent figure in the world of gold mining and a philanthropist dedicated to giving back to society.
After completing his MBA, Lassonde joined the Mining and Metals Division of Bechtel in San Francisco, California. However, his career truly took off when he joined Beutel, Goodman & Company in 1980 as a mining analyst and precious metals portfolio manager. During his tenure there, he managed the highly successful Dynamic Gold Fund for a decade.
In 1982, a pivotal moment occurred in Lassonde's career when he co-founded Franco-Nevada Corporation alongside his business partner, Seymour Schulich. In the beginning, Seymour, who worked as an oil analyst at the Canadian investment firm Beutel, Goodman & Company and crossed paths with Pierre there, was the one who noticed that the royalty model in the oil and gas industry yielded some of the highest capital returns.
Franco-Nevada marked the birth of the first publicly traded gold royalty company. Their vision proved to be extraordinarily successful. In 1985, Franco-Nevada acquired a royalty on a modest mining operation in Nevada's Carlin gold belt. Two years later, Barrick Gold took over the property, revealing the world-class Goldstrike deposit. Starting from its humble beginnings as a micro-cap company, it eventually culminated in its acquisition by Newmont Mining for a substantial $3.2 billion in February 2002. Franco-Nevada delivered a remarkable 36% annualized rate of return to its shareholders.
Lassonde served as the President of Newmont Mining from February 2002 to 2007 and subsequently took on the position of Vice-Chairman in 2007. In 2008, he orchestrated the revival of Franco-Nevada by partnering with David Harquail and the original Franco-Nevada team to acquire Newmont's royalty portfolio. This endeavor resulted in Franco-Nevada becoming the largest mining IPO ever offered on the Toronto Stock Exchange (TSE) at the time.
Not content with just one success story, Lassonde ventured into other endeavors. In 1993, he led a group of investors to create Metallica Resources, a company responsible for the discovery of the world-class El Morro deposit in Chile and the Cerro San Pedro mine in Mexico. Metallica's subsequent mergers with Peak Gold and Newgold, followed by another merger with Western Goldfields Resources, created a leading mid-size gold-producing company.
The partners' commitment to their industry and society was apparent through their philanthropic endeavors. Pierre Lassonde's generous donations to the University of Toronto led to the establishment of the Lassonde Geological and Mining Engineering Program. He also played a crucial role in the Canadian Mining Hall of Fame's permanent home at the university. Lassonde emphasized the importance of investing in people as the most valuable natural resource of a country.
Today, Pierre Lassonde is active as a strategic investor in the sector. In 2016, Lassonde backed the foundation of Orla Mining $OLA.TO, where he invested at $0.50 per share for a valuation of $15 million. Orla developed and built the Camino Rojo oxide mine in Mexico and acquired other mining projects. Orla is now a $1.5 billion mid-tier miner trading close to $5.00 per share.
He also invested in Prime Mining $PRYM.V, which was a $30 million market cap company, despite possessing a significant project in Mexico with an open-pit deposit. Lassonde saw the discrepancy between the company's market value and its asset value and recognized an opportunity. The stock went up 10x in 1.5 years, and Prime is currently advancing the Los Reyes project.
Other companies Lassonde invested in:
Foran Mining $FOM.V, which grew from a $12 million valuation to a $1 billion valuation while developing the McIlvenna Bay VMS project in Saskatchewan.
Atex Resources $ATX.V, which grew from a $10 million valuation to a $150 million valuation while drilling off the Valeriano copper-gold project located in the Atacama region, Chile.
Lassonde's story shows that success is not measured solely in financial terms but in the positive impact we leave on the world. Pierre Lassonde's journey inspires us all to dream big, work hard, and, in the end, use our success to make the world a better place.