MONTREAL – Calling the arrangement a “transformational transaction,” Osisko Gold Royalties has agreed to purchase the Orion Mine Finance Group portfolio, consisting of 74 royalties, streams and precious metals offtakes for $1.125 billion. Included are a 9.6% diamond stream on the Renard mine in Quebec, a 4% gold and silver stream on the Brucejack mine in British Columbia, and a 100% silver stream on the Mantos Blancos copper mine in Chile.
Osisko Gold Royalties’ bedrock investment is the 5% net smelter return from the Canadian Malartic mine in Quebec. Credit: Osisko Gold Royalties.
Osisko says the acquisition will create a leading world-class growth royalty company with a total of 131 royalties and streams, as well as 16 revenue generating assets. The company says its pipeline is forecast to produce over 100,000 gold equivalent oz. in 2018, and that will expand to 140,000 oz. AuEq by 2023. At the same time it will enjoy a pro forma cash flow growth of 10% per year.
The purchase price will consist of $675 million in cash plus $450 million in Osisko common shares. Orion will hold a 19.7% interest in Osisko. To raise the cash portion of the transaction, the Caisse de depot et placement du Quebec and Fonds de solidarite FTQ will be subscribing for $200 million and $75 million in Osisko common shares, respectively. Osisko will also draw down $150 million under its revolving credit facility. The remaining $250 million will be funded from the company’s current cash reserves.
For more details of the transaction, visit www.OsiskoGR.com.