Trident Royalties announces proposed acquisition of cornerstone asset
The 1.5% net smelter royalty is being acquired for a total consideration of A$8mln, of which A$1mln will be satisfied in Trident shares.
Lake Rebecca in Western Australia is a high-quality resource stage asset that shows potential for fast-track development within a world-class mining jurisdiction, Trident told investors. It is currently owned by ASX-listed Apollo Consolidated.
Apollo is well funded to progress development having boosted its coffers to around A$21.5mln following a recent fundraising and disposal of a non-core asset.
Trident expects the development of Lake Rebecca to benefit from its proximity to existing gold infrastructure in what is “a prolific gold district”.
“Existing, uncapped gold royalties over attractive, substantial gold projects being developed by credible operators are incredibly scarce globally, let alone in a jurisdiction such as Australia which more traditionally utilises equity and debt markets for project finance. The transaction reinforces the benefits of Trident’s global reach and network in sourcing attractive royalty opportunities,” Adam Davidson, the chief executive officer of Trident said in a statement.
“The royalty will become a cornerstone asset for Trident and is anticipated to provide material and long-term revenue commencing in 2023 with significant upside to both scale and mine life. At this early stage, Trident believes that Lake Rebecca is on track to support a circa 100koz/a operation, located in a desirable jurisdiction being supported by gold prices at close to all-time highs,” he added,
It is the fifth transaction Trident has announced since listing on AIM at the beginning of June.
“We’re encouraged by the attractive opportunities available to Trident – lending credence to our strategy of identifying and acquiring royalties outside the scope of the currently listed royalty peers, which have a predominant focus on precious metals in North America. I see this acquisition as a major step forward in our progress toward becoming the pre-eminent, growth-focused diversified mining royalty and streaming company,” Davidson said.
Shares in Trident were up 1.7% at 30p in a falling market in the first hour of trading.