South32 Limited (“South32”) is pleased to announce it has entered into a binding agreement for the sale of a package of minerals royalties to Elemental Royalties Corp. (“Elemental”). The royalty package consists of three gold royalties and one related non-gold royalty of immaterial value.

Completion of the transaction is subject to a number of conditions including approval from Australia’s Foreign Investment Review Board and Elemental securing the required funding. Upon satisfaction of the conditions, Elemental will make a US$40M cash payment and issue US$15M in Elemental shares to South32. Following completion of the transaction, South32 will hold an approximate 19.7 percent stake in Elemental, which trades on the TSX Venture Exchange.

“The sale of these royalties is another step forward in unlocking value in our portfolio, at a time when there is strong appetite for exposure to stand-alone royalty investments,” Chief Executive Officer Graham Kerr said. “The proposed transaction will realise a cash payment while retaining exposure to these royalties through a shareholding in Elemental.

Separately, we continue to hold a portfolio of royalties weighted towards base metals.