Mako Mining (TSXV: MKO) earlier this week completed its 100% acquisition of Mt. Hamilton, giving the company full ownership of the project in Nevada.
The purchase price is US$40 million, but Mako is not paying that amount in conventional upfront cash. Instead, the consideration is structured through a gold stream granted to the seller Sailfish Royalty. For the first 60 months, Sailfish will purchase 341.7 troy ounces of gold per month from Mako at 20% of the LBMA PM Fix price, with an effective price floor of US$2,700 per ounce and a cap of US$3,700 per ounce.
For the final 72 months, Sailfish will purchase 100 troy ounces of gold per month at 20% of the LBMA PM Fix price, with no floor or cap disclosed for that second phase.
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In total, the stream runs 132 months, or 11 years, and covers about 27,702 troy ounces of gold over the full term, consisting of roughly 20,502 ounces in the first five years and 7,200 ounces in the final six years.
Prior disclosure described the consideration as a five-year gold stream followed by a 2% net smelter return royalty for life of mine. The completed terms instead describe a two-stage gold stream lasting 132 months, with the final 72 months set at 100 ounces per month, and do not mention a continuing 2% NSR royalty.
Mako Mining last traded at $8.53 on the TSX Venture.
Information for this story was found via the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
