Equinox Gold Corp. and Sandstorm Gold Ltd announced the formation of Sandbox Royalties Corp., a new diversified metals royalty company.

Equinox Gold and Sandstorm have each entered into definitive purchase and sale agreements with Rosedale Resources Ltd, pursuant to which Rosedale will acquire a royalty portfolio from Equinox Gold for consideration of US$28.4 million in Rosedale common stock and Sandstorm for consideration of US$65 million comprising US$32.1 million in common stock of Rosedale and US$32.9 million in a promissory note convertible into common stock of Rosedale. Upon closing, Rosedale intends to change its corporate name to Sandbox Royalties Corp. In this article, Rosedale is used to refer to the company before closing and Sandbox is used to refer to the company after closing.

Sandbox Highlights:

  • A new well-funded and diversified metals royalty company: Sandbox will be exposed to a range of resource royalties, including gold, silver, copper, zinc, graphite and uranium; immediate cash flow from royalty generation; strong cash flow; and significant leverage to bolster metal prices and resource growth.
  • Primary Mining Jurisdictions: Sandbox’s royalty portfolio assets are primarily located in mining-friendly jurisdictions in the Americas and Europe.
  • Experienced Management: Sandbox will be led by Greg Smith as President and CEO, Marcel de Groot as Chairman of the Board, Victoria McMillan as Chief Financial Officer and Craig Rollins as General Counsel.
  • Solidarity shareholders: Sandstorm and Equinox Gold will hold 34% and 30% core interests in Sandbox, respectively, giving them the opportunity to participate in and facilitate Sandbox’s future growth.

Christian Milau, CEO of Equinox Gold, comments:

“Equinox Gold has revealed tremendous value as a significant and supportive shareholder of Solaris Resources and i-80 Gold, our previous spin-off companies, and intends to build on this momentum with Sandbox Royalties. Greg Smith will be an exceptional leader for Sandbox Royalties. His industry knowledge and business development skills have been integral to the growth and success of Equinox Gold over the past five years. Greg will continue to represent Equinox Gold on the boards of Solaris Resources and i-80 Gold and will transition from the position of President of Equinox Gold to the new role of President and CEO of Sandbox Royalties. We look forward to working closely with him as a supporting partner in this new venture. »

Ross Beaty, President of Equinox Gold, comments:

“Sandbox Royalties will create immediate and future value for Equinox Gold from our royalty portfolio and continue our close relationship with Sandstorm. Greg Smith will focus on building sandbox royalties, while Equinox Gold will slow down its M&A activity to focus on developing our cutting-edge internal growth pipeline, including our new Santa Luz gold mine in Brazil, which is transitioning to commercial production, our major expansion projects at Los Filos, Aurizona and Castle Mountain, and our major gold mine under construction at Greenstone.

Nolan Watson, President and CEO of Sandstorm, comments:

“Over the past few months, Sandstorm has been actively working to find unique and strategic ways to create value for our shareholders. With the creation of Sandbox, a diversified royalty company, we are taking royalties that are not currently receiving their guaranteed value in Sandstorm’s existing portfolio and showing their value so our shareholders can benefit now. Sandbox Royalties will join our growing list of strategic partners, with whom we can partner on future transactions and get the most out of a wide range of royalties in size and metal type.

Read the article online at: https://www.globalminingreview.com/exploration-development/30052022/equinox-gold-and-sandstorm-gold-royalties-launch-sandbox-royalties/

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