GoldMining Inc. (GOLD:TSX; GLDLF:OTCQX) announced in a news release it created a gold royalty company named Gold Royalty Corp. to "expose existing shareholders to an additional and distinct form of value enhancement."
The new, wholly owned subsidiary is expected to contain the net smelter return (NSR) royalties ranging from 0.5% to 2% that Vancouver-based GoldMining now holds on 14 gold projects. These original royalties of Gold Royalty Corp. would consist of 2% NSRs on two projects, 1% NSRs on 11 projects and a 0.5% NSR on one project. Eleven of the 14 NSRs are on resource and development projects currently in an advanced stage.
Opportunities to expand Gold Royalty Corp.'s portfolio exist as well. GoldMining could buy back some of the royalties owned by third parties on up to five of its projects and add those to the new company. Also, it could add future royalties on discoveries it makes on any of its gold-focused assets, all of which the company notes are located in mining friendly jurisdictions: the U.S., Canada, Brazil, Colombia and Peru.
"Following a decade-long effort since forming the company to assemble an extensive portfolio of gold projects in mining friendly jurisdictions in North and South America, we believe that the timing is right to create this royalty entity, which imparts an additional, and non-dilutive layer, of value to existing shareholders," GoldMining Chairman Amir Adnani said in the release.
"Over the long term, we intend to explore potential value-enhancing transactions for Gold Royalty Corp., including a potential spinoff, initial public offering, sale, merger or other transactions that may increase shareholder value," Adnani stated.
CEO Garnet Dawson said, "GoldMining's focus remains on our two-pronged strategy of expanding our property portfolio through accretive transactions of resource stage gold projects and their advancement towards development. We believe Gold Royalty Corp. will be a complementary platform to GoldMining's future acquisition and development plans."[NLINSERT]
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