Gold Royalty acquires royalty interests from Monarch Mining for $11.25 million
(Kitco News) - Monarch Mining (TSX: GBAR) announced today that it has entered into a definitive agreement with Gold Royalty (NYSE: GROY) whereby Gold Royalty will acquire royalty interests from Monarch for cash proceeds of $11.25 million.
The company said that the agreement includes a $2.50 per tonne royalty on all material processed through the Beacon mill originating from the Beaufor mine operations; and a 2.5% net smelter return royalty on each of the Croinor Gold, McKenzie Break and Swanson properties, of which half (1.25%) can be bought back by Monarch for $2 million per property in the future, subject to certain conditions being met.
Following the closing of the transaction, Monarch said it will have a strengthened balance sheet with approximately $30 million in cash and cash equivalents.
"We are very pleased to have signed this non-dilutive financing agreement with Gold Royalty, which will be applied mainly to capital expenditures and equipment purchases for the Beaufor mine and Beacon mill reopening and to strengthening our balance sheet," said Jean-Marc Lacoste, President and CEO of Monarch.
Gold Royalty is a gold-focused royalty company offering creative financing solutions to the metals and mining industry. Gold Royalty's diversified portfolio currently consists of net smelter return royalties ranging from 0.5% to 2.0% on 18 gold properties covering 12 projects located in the Americas.
Monarch Mining is a fully integrated mining company that owns four advanced projects, including the fully permitted past-producing Beaufor mine, which has produced more than 1 million ounces of gold over the last 30 years. Other advanced assets include the Croinor Gold, McKenzie Break and Swanson properties, all located near Monarch's wholly owned and fully permitted Beacon 750 tpd mill.