Sandstorm Gold goes on buying spree

Vancouver streamer  buying $1 billion worth of royalty, streaming assets

Sandstorm Gold co-founder and CEO Nolan Watson | BIV Archives

Sandstorm Gold Ltd.  (TSX:SSL, NYSE:SAND), a Vancouver gold royalty and streaming company, is growing through a $1.1 billion acquisition of two other gold royalty companies or their assets.

Sandstorm today announced it has entered a definitive agreement to buy Nomad Royalty Co. (TSX,NYSE:NSR) for $755 million. It also is buying nine royalties and one stream from BaseCore Metals LP for $525 million -- $425 million in cash and $100 million in Sandstorm common shares.

The acquisitions substantially increase Sandstorm’s exposure to precious metals, as well as copper.

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

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

“We believe that precious metals and copper are poised to materially outperform the market in the coming years, and we are excited to provide investors with exposure to long-life, high quality, and low-cost assets focused on gold, silver and copper.”

A former Silver Wheaton Corp. executive, Watson co-founded Sandstorm in 2008, getting in on the ground floor of a new mine financing model: streaming.

Streaming and royalty companies like Sandstorm finance new mine projects by providing cash in exchange for a share of the mine’s future gold and-or silver production at a fixed price. This gives them gold and silver streams without actually building mines themselves.

In April, Sandstorm reported preliminary revenue of $35 million on the sale of 18,700 of gold equivalent ounces in the first three months of 2022, which would be a quarterly record.