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Investing.com -- Sandstorm Gold (NYSE:SAND) stock rose 7% after Royal Gold (NASDAQ:RGLD) announced plans to acquire both Sandstorm and Horizon Copper in a move to strengthen its position as a leading North American gold-focused streaming and royalty company.
Under the agreement, Royal Gold will acquire Sandstorm in an all-stock transaction valued at approximately $3.5 billion, with Sandstorm shareholders receiving 0.0625 Royal Gold shares for each Sandstorm share. This represents a 21% premium based on the 20-day volume-weighted average price. Royal Gold will also acquire Horizon Copper for C$2.00 per share in cash, valuing the company at about $196 million and representing a 85% premium to Horizon’s 20-day average.
The combined transactions will add 40 producing assets to Royal Gold’s portfolio, expected to contribute between 65,000 and 80,000 gold equivalent ounces in 2025. This would increase Royal Gold’s 2025 production by approximately 26% based on current guidance from both companies.
"Upon completion of these transactions, Royal Gold will remain firmly positioned as a leading North American precious metal streaming and royalty company," said Bill Heissenbuttel, President and CEO of Royal Gold. "The addition of the Sandstorm and Horizon assets will create a global portfolio of precious metals interests that is unmatched in terms of asset diversification, development and organic growth potential, and exploration optionality."
The pro forma company will have 80 revenue-producing assets with no single asset expected to account for more than 13% of net asset value. The portfolio will maintain a strong focus on precious metals, with approximately 87% of revenue coming from precious metals and gold contributing about 75% of total revenue.
Both transactions are expected to close in the fourth quarter of 2025, subject to shareholder and regulatory approvals. Upon completion, Royal Gold shareholders will own approximately 77% of the combined company, with Sandstorm shareholders owning the remaining 23%.
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