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Streamers Gold Royalty, Abitibi Royalties and Golden Valley to combine

Kitco News

Gold Royalty (NYSE American: GROY), Abitibi Royalties (TSXV: RZZ) (OTC PINK: ATBYF) and Golden Valley Mines and Royalties (TSXV: GZZ) (OTCQX: GLVMF) announced today that they were combining.

Abitibi Royalties will receive 4.6119 Gold Royalty common shares for each Abitibi Royalties share. Golden Valley will receive 2.1417 Gold Royalty Shares. Abitibi will see a 22% premium and Golden Valley will see an 86% premium based on 20-day volume weighted average price of their respective stocks.

After the completion of the deal, Gold Royalty "...will continue to be led by a highly credible and established management team with a track record of creating value and sourcing accretive transactions," according to the news release announcing the deal.

CEO of Gold Royalty is former Goldcorp head, David Garofalo.

"We are pleased to present this consolidation opportunity to the shareholders of Golden Valley, Abitibi Royalties and Gold Royalty that will firmly establish the combined company as the leading growth and Americas-focused precious metals royalty company," said Garofalo in a news release. "We will have a significant presence in Québec and Nevada, two of the most favoured mining regions worldwide. The acquisition of Golden Valley and Abitibi Royalties represents a very compelling extension of our strategy by adding royalties over the world class Canadian Malartic mine - a generational asset that will continue to deliver gold production for decades to come. This business combination also provides a strong balance of asset quality, scale, financial strength and management to drive significant growth and to deliver further potential upside through a significant value re-rating to the benefit of all our stakeholders."

In an April study, McKinsey wrote that royalty and streaming sector was forecast to grow but scale matters.

Gold Royalty was down 5.92% to $4.13.

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