NYSE- and TSX-listed Sandstorm Royalties on Monday announced two acquisitions, which would significantly upsize its scale and size, as well as fortify its focus on gold, silver and copper exposure.

The company would buy the issued and outstanding common shares of precious metals-focused royalty company Nomad Royalty Company for an implied equity value of about $590-million (C$755-milion).

Through the Nomad acquisition, Sandstorm adds several high-quality and low-cost assets. Based on analyst consensus, Nomad’s portfolio comprises 91% precious metals and nearly 50% producing assets, spread across South Africa (Blyvoor), Chile (Caserones), Cote d'Ivoire (Bonikro), Mexico (Mercedes), the US (Moss and South Arturo) and Brazil (RDM).

Nomad's development assets are in South Africa (Platreef), Canada (Greenstone and Blackwater), Australia (Woodlawn), the US (Cortez Complex) and Argentina (Gualcamayo).

Sandstorm also agreed to acquire nine royalties and one stream from BaseCore Metals – an entity equally owned by affiliates of Glencore and Ontario Teachers’ Pension Plan Board – for a total of $525-million, of which $425-milion would be paid in cash and $100-million in common shares.

Concurrent with the BaseCore transaction, and in line with its precious-metals strategy, Sandstorm will sell the acquired 1.66% net profits interest on the Antamina copper mine  to Horizon Copper, while retaining a long-life silver stream on the Antamina mine.

“These transactions mark the next step in the strategic growth plans for Sandstorm,” said president and CEO Nolan Watson.

“Today’s announcement propels the company forward in both size and scale while solidifying Sandstorm’s position among its peers as the highest-growth streaming and royalty company,” he added.

On completion of the transactions, Sandstorm’s resulting portfolio will total 260 streams and royalties, of which 39 of the underlying assets will be cash-flowing with no asset contributing more than 15% to the company’s consensus net asset value.

The transactions will increase Sandstorm’s 2022 production guidance by about 22% from 65 000 to 70 000 gold-equivalent ounces (GEOs) to between 80 000 and 85 000 GEOs. The long-term production guidance will increase by 55%, from 100 000 GEOs to 155 000 GEOs in 2025.

“Nomad has executed and delivered on its commitment to create value for our shareholders through our disciplined transaction-driven strategy. Today’s transaction builds on our vision to create a pureplay, highly diversified, cash flow- focused royalty and streaming company with peer-leading growth. Catalysing the creation of the next large royalty company has always been our objective,” commented Nomad CEO Vincent Metcalfe.

Upon completion, Nomad shareholders would maintain a meaningful ownership in Sandstorm's portfolio of assets, holding 28% of the company.

Under the terms of the transaction, shareholders of Nomad would receive 1.21 common shares for each Nomad share held. The consideration implies a value of about C$11.57 a Nomad share and represents a premium of 34% on the 20-day volume-weighted average price of the Nomad shares and Sandstorm shares on the TSX for the period ending on April 29.