Each one in plain English, with the numbers worked through for a shareholder.
18 Jan 2023business combination● NeutralMajor
The Ontario Superior Court granted the final order approving Triple Flag's acquisition of all Maverix shares, for US$3.92 cash or 0.360 of a Triple Flag share per Maverix share (subject to the 15% cash / 85% share proration). The arrangement was expected to take effect on or about January 19, 2023, subject to the remaining closing conditions, after which Maverix expects to delist from the TSX and NYSE and cease to be a reporting issuer in Canada. Closing itself is not yet confirmed in this filing.
Maverix shareholders approved the Triple Flag arrangement with 98.378% of votes cast, and Canadian competition clearance was received and the US Hart-Scott-Rodino waiting period expired. Each share can get US$3.92 in cash or 0.360 of a Triple Flag share, with cash capped at 15% of total consideration and shares at 85%; elections covered about 26% of shares for cash and about 74% for Triple Flag shares. Final court approval was still needed, with closing targeted before the end of January 2023, followed by delisting from the TSX and NYSE American and deregistration.
A court granted an interim order for a plan of arrangement under which Triple Flag Precious Metals Corp. will acquire all of Maverix's shares, and set a special shareholder meeting for January 12, 2023. This filing is the first mention in the context of the Triple Flag deal (it refers to it as previously announced; its terms are not given here), so it reveals Maverix's planned sale as a new thread; the order also gives registered shareholders dissent rights.
Maverix completed the Barrick royalty portfolio purchase announced on September 1, 2022. Because Skeena exercised its right to buy back half of the Eskay Creek royalty (leaving 0.5%) for C$17.5 million, Maverix's upfront cash payment fell from US$50 million to US$37.2 million, paid from cash on hand and the revolving credit facility. Contingent payments of up to US$10 million are still described, and some royalties will only be transferred to Maverix at later dates once transfer conditions are met.
Maverix agreed to buy a portfolio of 22 royalties from Barrick Gold for US$50 million upfront cash, plus up to US$10 million more if certain events occur within six years (US$6 million if Eskay Creek gets all material construction permits, and US$2 million each when Maverix has received US$10 million and US$20 million from the portfolio, excluding Eskay Creek). The headline asset is a 1.0% royalty on Skeena's Eskay Creek project in British Columbia, and the filing says the deal lifts Maverix to 147 royalties and streams; it is funded from cash on hand and the revolving credit facility, with closing expected by end of September 2022.
Maverix bought three Nevada gold royalties (Lewis, Dixie Creek and Railroad) from a Waterton subsidiary for US$5 million cash. The royalties come with small yearly advance payments (roughly US$75,000-97,000 each), and the Lewis ground adjoins the Phoenix mine. The Railroad name matches an asset in the Kinross portfolio, but the filing does not say whether they are related.
Maverix reported record attributable gold equivalent ounces of about 9,000 in Q4 2021 and over 32,000 for 2021, beating guidance of 31,000 (itself raised in November 2021 from 27,000-30,000). It declared a quarterly dividend of US$0.0125 per share, payable around March 15, 2022 to holders of record February 28, 2022, up from the US$0.01 first dividend in 2019. It also noted Orla's first gold pour at Camino Rojo, where Maverix holds the 2% royalty acquired from Newmont in 2020.
Maverix amended its revolving credit facility, raising it by US$40 million from US$120 million to US$160 million, with a 4-year term maturing September 2025. Bank of Montreal joins the existing lenders (National Bank, CIBC, Bank of Nova Scotia). Nothing is currently drawn, so the full US$160 million is available, which implies the earlier drawings for Hope Bay and Kinross have been repaid. It also filed a preliminary base shelf prospectus allowing up to US$500 million of securities offerings, to replace the one expiring October 13, 2021; this is only a filing, with no offering announced.
Maverix completed the Newmont royalty portfolio purchase announced on September 21, 2020, paying US$15 million cash and issuing 12 million shares. Newmont now holds 42 million Maverix shares, about 30%. Some royalties still depend on Mexican competition authority authorization, and some are subject to rights of first refusal. The filing does not say whether the contingent payments of up to US$15 million are still in place.
Maverix agreed to buy 11 gold royalties from Newmont for US$75 million upfront (12 million new Maverix shares at a deemed US$5.00 plus US$15 million cash) and up to US$15 million more in contingent payments tied to three projects reaching commercial production within five years. Newmont's stake would rise from 30 million shares (23.4%) to 42 million (about 30%), diluting other holders. Closing was expected by October 30, 2020, subject to TSX approval and disinterested shareholder consent. Key assets include Camino Rojo (2.0% NSR) and Cerro Blanco (1.0% NSR).
Maverix closed the Beta Hunt royalty reduction with Karora (7.5% to 4.75%, effective July 1, 2020). The filing now states total consideration of US$18 million in cash, with US$15.5 million received at closing and US$2.5 million due in January 2021, and Maverix plans to use the proceeds to pay down its revolving credit facility. This differs from the June 30 announcement, which described US$5 million cash plus 35.1 million Karora shares; the filing does not explain the change, and does not mention the shares.
Maverix agreed to cut the gold royalty it holds on Karora Resources' Beta Hunt mine from 7.5% to 4.75%, effective July 1, 2020. In return Karora will pay US$5 million in cash (half at closing, half in January 2021) and issue 35.1 million Karora shares at C$0.506 each. Closing still needed third-party and TSX approvals, and the shares carry trading restrictions until June 30, 2021. Maverix gives up part of a royalty in exchange for cash and Karora shares.
Maverix completed the Kinross royalty portfolio purchase announced on December 2, 2019, paying US$25 million in cash (from cash on hand and its credit facility) and issuing 11.2 million new shares. The filing now describes the portfolio as 'over 20' royalties (the earlier announcement said 25). There are now 119.5 million shares outstanding, with Kinross holding about 9.4%, Newmont Goldcorp about 25.1% and Pan American Silver about 23.1%. Some royalties are subject to rights of first refusal and will be acquired in later closings if those rights are not exercised, and Kinross gets anti-dilution rights on future equity raises.
Maverix agreed to buy a portfolio of 25 precious metals royalties from Kinross Gold for 11.2 million new Maverix shares plus US$25 million cash, with closing expected by December 31, 2019. Kinross would then own about 9.4% of Maverix, so existing shareholders are diluted; the company funds the cash part from cash on hand and its credit facility, and expects the portfolio to generate roughly US$3-4 million of cash flow in 2020.
Maverix declared its first-ever quarterly dividend of US$0.01 per share, payable January 15, 2020 to shareholders of record on December 31, 2019. Future dividends remain at the board's discretion.
Maverix closed an increase of its revolving credit facility so it can borrow up to US$120 million. Canadian Imperial Bank of Commerce and National Bank of Canada continue as lenders and The Bank of Nova Scotia joins; the money is intended for future royalty and stream acquisitions and general corporate purposes.
Maverix completed the Hope Bay royalty purchase announced on August 14, 2019. It now holds a 2.75% royalty effective August 1, 2019, which falls to 2.5% once the royalty is registered against the property, and it drew on its existing credit facility to pay for it.
Maverix agreed to buy an extra 1.5% net smelter royalty on TMAC Resources' Hope Bay gold mine in Nunavut for US$40 million cash, on top of the 1.0% royalty it already held, giving 2.5% in total. It will also subscribe US$3 million for TMAC shares and fund the deal from cash and its existing credit facility; closing was expected around August 16, 2019.
