Royal Gold to Acquire Sandstorm Gold Royalties and Horizon Copper, Forming Large-Scale, Industry-Leading Streaming and Royalty Company

Core Viewpoint - Sandstorm Gold Ltd. has entered into a definitive arrangement agreement with Royal Gold Inc. for an all-share transaction valued at approximately $3.5 billion, providing Sandstorm shareholders with a premium on their shares [1][24][25]. Transaction Details - Sandstorm shareholders will receive 0.0625 of a Royal Gold Share for each Sandstorm Share held, representing a 21% premium to the 20-day volume-weighted average price (VWAP) and a 17% premium to the closing price on July 3, 2025 [1][24]. - Royal Gold will issue approximately 19 million shares to Sandstorm shareholders, resulting in former Sandstorm shareholders owning about 23% of the issued Royal Gold Shares on a fully diluted basis [25]. Strategic Rationale - The transaction is expected to create significant value for Sandstorm shareholders by providing immediate premium and maintaining exposure to a high-quality, long-life portfolio [4][5]. - The merger aims to close the valuation gap between Sandstorm and mid-tier royalty peers, improve portfolio maturity, and enhance access to institutional investors [5][7]. Pro-Forma Royal Gold - Post-transaction, Royal Gold will have a diversified portfolio of 393 streams and royalties, with 80 cash-flowing assets and 47 in development, primarily focused on precious metals [8][9]. - The revenue mix for 2025 is projected to be approximately 87% from precious metals, with gold contributing about 75% of total revenue [9][10]. Key Producing Assets - Notable assets include Mount Milligan, Pueblo Viejo, and Cortez, which are expected to contribute significantly to Royal Gold's revenue through their respective production guidance [12][13][14]. - Mount Milligan is projected to produce 165,000–185,000 ounces of gold and 50–60 million pounds of copper in 2025 [12]. Key Development Assets - Development projects such as MARA, Hod Maden, and Platreef are expected to provide substantial organic production growth over the long term [19][20][22]. - MARA is anticipated to produce approximately 200,000 tonnes of copper equivalent per year with a mine life exceeding 20 years [19]. Board Recommendations - The Boards of Directors of Royal Gold and Sandstorm, along with a special committee of independent directors, have determined that the transactions are in the best interests of their respective companies [23]. Approval and Timing - The completion of the transactions is subject to shareholder approvals and regulatory conditions, with an expected closing in the fourth quarter of 2025 [34][27][30].