Royal Gold (NASDAQ: RGLD) has made a major move in terms of M&A this morning, announcing that it has entered into agreements to acquire not one but two competitors within the industry. The royalty and streaming name has come to terms to acquire both Sandstorm Gold (TSX: SSL) and Horizon Copper (TSXV: HCU).
All told, Royal will be adding a total of 40 new producing assets to their current portfolio, increasing 2025’s estimated production by between 65,000 and 80,000 ounces. Post-closing, Royal is expected to have one of the most diversified asset bases within the segment, with a total of 80 producing assets, with none of those assets accounting for more than 13% of net asset value.
A further 47 assets are classified as development stage on a post-closing basis, while 266 are classified as being in evaluation and exploration stages.
Royal’s 2025 gold equivalent ounce production profile is expected to increase by about 26% as a result, based on current guidance midpoints. Pro forma, 87% of production will come from preciously metals, with gold amounting to 75% of total estimated revenue this year.
“This transaction rewards Sandstorm shareholders in the near term while also offering a compelling opportunity to own a large-scale, world-class streaming and royalty company with continued upside potential. Joining forces with Royal Gold will amplify the strengths of Sandstorm’s portfolio and unlock new opportunities for our shareholders as we create a truly extraordinary royalty company,” commented Nolan Watson, CEO of Sandstorm, on the acquisition.
Under the terms of the arrangement, Sandstorm Gold will see shareholders receive 0.0625 shares of Royal Gold for each share of Sandstorm currently held. The figure represents a premium of 17% to Thursday’s closing price of Sandstorm, valuing the company at $3.5 billion.
Horizon Copper shareholders meanwhile will be compensated in the form of cash, with shareholders to receive C$2.00 per share of Horizon currently held. That figure represents a 72% premium to Friday’s close, valuing Horizon at roughly $196 million.
Post-transaction, Royal Gold shareholders will hold 77% of the resulting company, while Sandstorm shareholders will own 23%. The acquisition is said to be immediately accretive to NAV per share for Royal shareholders.
The transactions remain subject to the approval of Sandstorm and Horizon shareholders, alongside customary regulatory approvals. The arrangements are expected to close in the fourth quarter of 2025.
Royal Gold last traded at $179.82 on the Nasdaq.
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