Metalla’s strategic partner Beedie Capital will commit to an equity investment of C$15m, increase the company’s existing convertible loan facility to C$50m, and own around 9.7% shares of the combined company, upon closing
Metalla agrees to acquire Nova for $140m. (Credit: omid roshan on Unsplash)
Canada’s Metalla Royalty & Streaming (Metalla) has agreed to acquire all the issued and outstanding common shares of Nova Royalty (Nova) for C$190m ($139.74m).
The transaction will create a combined company, which will be positioned as one of the leading emerging intermediate royalty companies.
Under the terms of the transaction, Nova shareholders will receive 0.36 of a Metalla common share, in exchange for each Nova common share held.
The acquisition is subject to approval by at least 66 2/3% of votes by Nova shareholders, at a special meeting of Nova shareholders, along with other conditions.
The other conditions include approvals by the British Columbia Supreme Court, the TSXV, and the NYSE American, and receipt of necessary regulatory and third-party approvals.
Upon closing, Metalla shareholders would own around 60% and Nova shareholders around 40% of the combined company.
The combined company will have a portfolio of 105 royalties and streams with 20 years of sustainable growth, noted the companies in a joint statement.
Metalla president and CEO Brett Heath said: “We are very excited about the combination of these businesses. This merger represents a transformative moment for both companies and will lay a clear, low-risk path to becoming an intermediate royalty company.
“Together, we expect that our peer-leading, high-quality growth, underpinned by some of the best-in-class operators in the mining sector, will deliver superior long-term value for our shareholders.
“We are very happy to have the continued support of Beedie Capital as a strategic partner in the journey to build Metalla into a leading intermediate royalty company.”
As part of the transaction, Metalla’s strategic partner Beedie Capital, a multi-strategy direct investment platform, will commit to an equity investment of C$15m.
Also, Beedie will increase the Canadian royalty company’s existing convertible loan facility to C$50m, resulting in around $35m of available liquidity.
Upon closing, Beedie will hold 8.7 million common shares of Metalla, which represent around 9.7% of the issued and outstanding common shares of the combined company.
Nova interim CEO Hashim Ahmed said: “We are excited to be combining with Metalla to create a truly special royalty company built on long-lived, top-quality assets.
“In May 2023, we launched a robust strategic process to explore and review all the options available to Nova that would maximise shareholder value.
“After evaluating various options presented during the process, it was clear that this Transaction represents a significant value creation opportunity and the best way forward for Nova shareholders.”
“We look forward to working with Metalla and our shareholders to complete this Transaction and believe the combined company will be a long-term leader with a bright future.”