Canada Nickel Launches RoyaltyCo, Sells Partial Interest For $8 Million Cash, Shares
Canada Nickel Corp (TSXV: CNC) has entered into an agreement to sell net smelter return royalties on all of its regional exploration properties within the Timmins district, except for the Crawford project and projects on the Project 81 patents.
The company has entered into a binding letter of intent with Edmiston Drive Capital, which will see the creation of a new royalty company to hold these royalties. Compensation will consist of $8 million in cash and 8.9 million shares of Edmiston Drive Capital, resulting in Canada Nickel holding a 62% interest in Edmiston Drive upon closing.
The transaction will see 1% NSR’s granted to a royalty subsidiary of Canada Nickel, which will then merge with a subsidiary of Edmiston Drive.
The transaction remains subject to Edmiston Drive completing a financing that will see it raise $9 million through the issuance of common and preferred shares. The transaction is expected to close by April 30.
“We are very excited to work with EDCC toward the creation of a new royalty company which will hold NSR royalties of the Company’s portfolio of properties in the Timmins Nickel District which, when combined, we expect to be among the world’s largest nickel sulphide resources. We have published resources on two of these properties and expect to announce a further six resources by mid-2025. This transaction is just one further step in unlocking value while minimizing equity dilution for Canada Nickel shareholders.,” commented Mark Selby, CEO of Canada Nickel.
Canada Nickel last traded at $1.10 on the TSX Venture.
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