Nomad Royalty Company (TSX: NSR) announced this morning that it has entered into an agreement to acquire an additional 37.5% in equity on private Chilean mining firm Compania Minera Caserones. The transaction, reported to be for a cash consideration of US$27.25 million, will see the Canadian company increase its equity stake to 67.5%.
Compania Minera Caserones holds the payment rights to 32.5% of a 2.88% net smelter return royalty on the producing Caserones mine located in the Atacama region of Chile. The transaction effectively consists of a 0.351% net smelter return royalty, increasing Nomad Royalty’s stream from the mine to 0.63%.
In May 2021, Nomad Royalty acquired the initial 30% equity on the Chilean company — and effectively 0.28% net smelter return royalty — for a cash consideration of US$23 million.
The Montreal-based gold & silver royalty company is expecting to fund the transaction through its revolving credit facility.
In 2019, the Caserones mine produced 146 kilotonnes of copper and 2,778 tonnes of molybdenum. The property has over 5 years of operational history with a current estimated mine life of 19 years.
The transaction is expected to close in August or early September 2021, subject to regulatory approvals and customary closing conditions.
Nomad Royalty last traded at $7.71 on the TSX.
Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.