Franco-Nevada to Buy 1.45% Royalty in A$200 Million Minerals 260 Deal
The streaming company will also subscribe for A$30 million of Minerals 260 shares, lifting its Bullabulling interest to a 3.90% gross royalty.
Franco-Nevada Corporation (FNV) agreed to acquire an additional 1.45% gross royalty on the Bullabulling Gold Project and to subscribe for A$30 million of Minerals 260 Limited shares in a follow-on financing package worth A$200 million, increasing its interest in the Australian gold project to a 3.90% gross royalty.
The streaming and royalty company said the package is intended to support further development of Bullabulling and to deepen an existing partnership with Minerals 260. The new royalty sits on top of the interest Franco-Nevada already holds, and the equity subscription gives the company a larger stake in the developer as the project advances.
Paul Brink, President & CEO of Franco-Nevada, said: “Both the team at Minerals 260 and the Bullabulling orebody continue to surpass our expectations. Minerals 260 is ahead of schedule on project development and financing and has rapidly grown its resource endowment. We are delighted to take this next step in building our partnership with the company and firmly believe that our financial backing can play a linchpin role in generating value for Minerals 260 shareholders.”
The A$30 million share subscription is the equity component of the A$200 million package. The remainder is delivered as the additional 1.45% gross royalty, which the company described as a further step in building its position at Bullabulling. Franco-Nevada said it believes its financial backing can play a linchpin role in generating value for Minerals 260 shareholders.
The move follows a pattern in which Franco-Nevada has used royalty and equity commitments to back gold developers as they fund construction and resource expansion. In March, a wholly owned U.S. subsidiary of Franco-Nevada completed a $250 million royalty financing with i-80 Gold Corp. (IAUX) in exchange for a 1.5% life-of-mine net smelter return royalty, stepping up to 3.0% on January 1, 2031, with proceeds used in part to retire legacy debt and advance Mineral Point and Archimedes.
The Bullabulling package is smaller in scale than that i-80 deal and is structured as a follow-on rather than a first royalty sale. Franco-Nevada already held a gross royalty on the project before this agreement; the new 1.45% interest and the A$30 million equity subscription together raise its total gross royalty to 3.90%.
Minerals 260 said the financing supports development of Bullabulling. Franco-Nevada said the company is ahead of schedule on project development and financing and has rapidly grown its resource endowment. The partnership is expected to continue as Minerals 260 advances the project toward production.