Teck Sells Chile Gold Mine Production

Royal Gold says it is acquiring a 90% interest in the gold stream byproduct of the Andacollo copper mine in Chile from Teck Cominco for a total of $300m. Royal Gold will pay $100m in cash, plus some 4.45m of its own common shares valued at $200m based on a 5-day trailing volume weighted average price of $44.90 per share. Royal Gold is entitled to payment based on 75% of the payable gold produced until production reaches 910,000 ounces of payable gold and payment based on 50% of any payable gold production above that quantity. Teck, which is said to have hired BMO Capital as financial advisor, says it will use the proceeds to pay down debt related to its acquisition of Fording Canadian.