Elemental Altus and EMX form new midtier royalty company
TSX-V-listed Elemental Altus Royalties on Thursday announced the acquisition of NYSE-listed EMX Royalty, with the merged company to continue under the new name of Elemental Royalty.
In support of the transaction, Tether Investments and Elemental Altus have entered into a subscription agreement whereby Tether has agreed to purchase 75-million Elemental Altus shares at C$1.84 each for aggregate gross proceeds of $100-million.
The merged company will have 16 producing royalties contributing to a projected adjusted revenue of $80-million in 2026, positioning it as a new midtier streaming and royalty company.
Elemental Royalty will have a gold-focused portfolio with a commodity split of 67% precious metals and 33% base metals on a latest quarter revenue basis providing exposure to record gold prices.
“Elemental Altus' portfolio, with a strategic emphasis on royalty acquisition, and with more than 75% of revenue associated with gold-producing mines, is complemented by EMX's revenue generating portfolio paired with their royalty generation business,” said Elemental Altus CEO Frederick Bell.
“The support from Tether in the form of a $100-million placement, as well as the existing cashflow generation, provides the ability to pursue further valuable growth through acquisitions of the best opportunities in the sector.”
David Cole, the CEO of EMX, added that the merger offered a “superb opportunity” to combine two royalty companies with a shared mindset of financial discipline in the pursuit of growth.
“Royalties are phenomenal financial instruments that leverage commodity price exposure and the asymmetric upside of exploration success,” he said.
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