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Correction: Kinross Gold Sells Royalty Portfolio For $74 Million To Maverix Metals

Kitco News

Correction: The article incorrectly stated the company's production guidance. The company is on target to meet its production estimates as well as meet the lower end of their costs estimates.

(Kitco News) - Kinross Gold (NYSE: KGC, TSX K): is stepping away from the royalty business as it looks to raise $74 million in a transaction for cash and shares.

The mid-tier mining company announced Monday that it was selling its royalty portfolio to Maverix Metals Inc (NYSE: MMX, TSX: MMX), for $25 million in cash and 11.2 million Maverix common shares, representing a 9.4% ownership interest in Maverix.

“This agreement realizes the value of our royalty portfolio today while also providing upside exposure through a meaningful equity position in Maverix, a company with a proven track record of growth,” said J. Paul Rollinson, president and CEO of Kinross Gold.

Kinross said that its royalty portfolio is comprised of 25 precious-metals royalties, including interests in Integra Resources’ DeLamar project in Idaho, Polymetal’s Omolon Hub operations in Russia, Barrick Gold and Newmont Goldcorp’s Cerro Casale project in Chile, Premier Gold Mines’ McCoy Cove project in Nevada, Agnico Eagle’s Hammond Reef project in Ontario, and a number of early stage development and exploration projects.

The transaction is targeted to close by the end of the year.

The deal comes after Kinross reported disappointing earnings for the third quarter. The company reported lower-than-expected gold production and cash flow between July and September. However, the company said that it was on target to meet ti annual gold production forecast and hit the low end of its cost guidence.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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