- EMX Royalty Corporation (EMX) is acquiring an additional 0.3155 per cent net smelter return (NSR) royalty on the Caserones Mine for US$25.74 million
- The mine generated pre-tax cash flow from 2021 totalling $3.6 million from EMX’s interest
- EMX has agreed to complete a private placement with Franco-Nevada for $12.58 million
- It will fund the purchase of the additional NSR
- EMX Royalty Corporation (EMX) is up 6.46 per cent trading at $2.80 per share as of p.m. ET
EMX Royalty (EMX) is acquiring an additional 0.3155 per cent net smelter return royalty (NSR) on the Caserones Copper-Molybdenum Mine for US$25.74 million.
When combined with the 0.418 per cent NSR interest, EMX now holds an effective 0.7335 per cent NSR royalty. Franco-Nevada Corporation has concurrently acquired a 0.4582 per cent NSR royalty on similar terms.
Since the acquisition, Caserones has generated pre-tax cash flow from 2021 Q2-Q4 totalling $3.6 million from EMX’s interest. As part of the royalty purchase, EMX will receive royalty distributions covering Q1 of fiscal 2022 for the additional interest acquired.
To finance its purchase of the additional NSR royalty, EMX has agreed to complete a private placement with Franco-Nevada for $12.58 million (US$10 million). Franco-Nevada will then own approximately 3.5 per cent of the issued and outstanding shares of EMX on an undiluted basis.
Franco-Nevada will purchase 3.8 million units at $3.30 per unit. Each unit will consist of one common share of EMX and one warrant to purchase one common share of the company for five years priced at $4.45.
The Caserones mine is subject to a 2.88 per cent NSR royalty created in a 2009 agreement.
EMX has purchased a further 16.23 per cent of the shares of SLM California (a vendor of the mine) for US$25.74 million related to share purchase agreements with existing shareholders of SLM California.
EMX Royalty Corporation (EMX) is up 6.46 per cent trading at $2.80 per share as of p.m. ET.
