Precious metals focused royalty and streaming company Summit Royalty has announced plans to go public through a reverse takeover (RTO) of Canada-listed junior royalty firm Eagle Royalties.

The two companies on Wednesday announced a definitive amalgamation agreement, signed on June 30. Under the terms of the transaction, Eagle will acquire Summit via a three-cornered amalgamation involving a newly formed subsidiary, Eagle Subco. Upon closing, Summit shareholders will receive five shares of the resulting public company for each Summit share held.

The exchange ratio implies estimated consideration of C$0.18 per Eagle share, representing a premium of 47% based on Eagle's closing price on June 30, on the Canadian Securities Exchange.

The merged entity, referred to as the "resulting issuer," will be 80% owned by existing Summit shareholders and 20% by Eagle shareholders. The common shares of Eagle remain halted pending further regulatory filings.

"We are excited to announce this RTO with Eagle as we move toward a public listing and the combination of two strong royalty portfolios," said Summit president and director Drew Clark. "Eagle’s portfolio of royalties, notably including a royalty on a portion of Banyan’s seven-million-ounce AurMac gold project . . . will provide excellent optionality that will complement our cash-flowing portfolio."

"We are very pleased to announce the RTO and partnership with Summit as Eagle enters this new and exciting chapter in its development," added Eagle president and CEO Tim Termuende. "This transaction immediately unlocks value for Eagle shareholders through a significant upfront premium."

The deal will create a new royalty and streaming company with assets spanning North and South America and Africa, including a 50% silver stream on Orezone Gold’s Bomboré mine in Burkina Faso, a royalty on Jaguar Mining’s Pitangui gold project in Brazil, and a royalty on Denarius Metals’ Zancudo mine in Colombia.

Following the RTO, the resulting Issuer will be renamed Summit Royalty, with Clark serving as president and CEO, and Connor Pugliese as VP corporate development. The new board will include industry veterans Jerrold Annett, formerly of Capstone Copper, Steven Eddy, formerly senior VP at Iamgold, Russell Mills, partner, Mills Dunlop Capital Partners, and Blair Zaritsky, CFO of Osisko Metals and former CFO of Osisko Mining.

The deal is subject to shareholder approval from both parties and acceptance by either the Canadian Securities Exchange or TSX-Venture Exchange. Eagle plans to hold a shareholder meeting in the coming months.

Summit was founded with a mandate to grow into a midtier royalty and streaming player, targeting acquisitions that would have an outsized impact on its cash flow and valuation. The company currently carries no debt and maintains sufficient liquidity for future acquisitions.

The combined portfolio will include more than 40 royalty interests, with Eagle contributing a broad range of critical metals, gold, and industrial mineral royalties in Western Canada. Its flagship holding is a royalty on Banyan Gold’s AurMac project in Yukon, where Eagle holds between 0.5% and 2% NSR on key deposits.

Clark, a former VP at Metalla Royalty and Streaming, has led or contributed to more than $300-million in royalty transactions across his career. His team includes several professionals with extensive experience in corporate development, mining deals and finance.

"Summit’s team of experienced royalty professionals will unlock significant value for Eagle’s shareholders through the addition of Summit’s current portfolio of cash-flowing royalty and streaming assets," Termuende said.