TSX- and NYSE-listed Yamana Gold has completed the sale of a portfolio of royalty interests and a contingent payment agreement to Nomad Royalty Company for $65-million.
Nomad, formerly Guerrero Ventures, will start trading on the TSX on May 29.
The contingent payment agreement relates to declaration of commercial production at the Deep Carbonates project, at the Gualcamayo gold mine, in Argentina.
Yamana has received from Nomad an initial upfront cash consideration of $10-million, as well as $45-million in common shares of Nomad at a price of C$0.90 apiece.
Further, Yamana has the right to receive an additional $10-million through a deferred cash payment, that may be paid in cash or common shares of Nomad.
The transaction provides Yamana with a meaningful stake in a new precious metals royalty company that has a strong and diversified asset base and significant potential upside through project development.
The company will have a 13% stake in Nomad when the transaction closes and can nominate one person to join Nomad’s board of directors, with Yamana corporate development senior VP Gerardo Fernandez having been nominated to join the Nomad board.
Yamana says the closing of this sale transaction underpins another step in its strategy to optimise its portfolio, continue strengthening its financial flexibility and creating value from its strategic assets.
Yamana remains focused on producing gold and silver in the Americas, including Canada, Brazil, Chile and Argentina.