SolGold completes $100m royalty financing with Franco-Nevada

Mon, 14th Sep 2020

Mining company SolGold said it had completed a previously announced $100m royalty financing pursuant to an agreement with Franco-Nevada Corporation. The agreement was in relation to the company's flagship Alpala copper-gold project and the remainder of the Cascabel concession in northern Ecuador. Franco-Nevada had on 11 September advanced to SolGold $100m under the agreement, less the amount of outstanding principal and interest under a $15m secured bridge loan. The aggregate amount owing under the bridge loan was therefore repaid out of the proceeds of the royalty financing. 'Accordingly, the company is not required to issue 12.2m warrants to Franco-Nevada that would have been required had the company elected to extend the maturity date under the bridging loan for a further four month term,' SolGold said. It added that it would apply the funds received to progress the Alpala project through to a final feasibility study and a development decision. 'The balance of the proceeds are expected to be used for SolGold's share of the development of Alpala pursuant to agreements with the minority shareholder of Exploraciones Novomining, Cornerstone Capital Resources,' the company said. In return for the royalty purchase price, Franco-Nevada had been granted a perpetual 1% royalty interest, to be calculated by reference to net smelter returns from the Cascabel. Furthermore, the financing could be upsized by $50m at SolGold's election to a 1.5% royalty interest on or before 11 January 2021. Story provided by

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