Altus Strategies (ALS) has finalised its recently announced agreement to acquire an effective 0.418% net smelter return royalty interest on the producing Caserones Copper Mine in Chile.

The mining royalty company is acquiring the NSR interest in the copper mine, located in the Atacama region of northern Chile,  for US$34.1 million through a strategic 50:50 partnership with NYSE American as well as TSX Venture exchanges listed, EMX Royalty Corporation.

Caserones is owned and operated by JX Nippon Mining & Metals Corporation of Japan and has an estimated 17 years of production remaining. Altus expects the Caserones NSR will provide it with immediate and long-term cash flows, in line with its stated growth strategy.

At the time of the announced acquisition in mid-June 2021, Steven Poulton, Chief Executive of Altus Strategies said the acquisition of “a significant cash paying royalty on a long-life copper mine in a tier-1 mining jurisdiction” represented a landmark transaction for the firm. The NSR interest is expected to generate c.$3.2m (post-tax) per year attributable to Altus.

In addition to the acquisition, Altus has created a Special Purpose Vehicle ("SPV") alongside EMX Royalty Corporationincorporated in Chile that is owned jointly by Altus and EMX. 

The SPV has now acquired an effective 0.836% NSR royalty for $68.2m, Altus told investors. The acquisition has been part-financed by a US$29m acquisition bridge loan facility by La Mancha, its largest shareholder, which recently established a $1.4bn mining investment fund.

The balance of the consideration is being funded from the Company's existing cash on hand. Following the Acquisition, Altus has around GB£6.3m / US$8.7 million of cash on hand.

The Company highlighted to shareholders that the provision of this facility underscores La Mancha's commitment to the long-term growth of Altus and the quality of this Acquisition.

In addition to Altus’ Acquisition, TSX-listed Nomad Royalty Company, which has a market capitalisation of around C$440 million, has agreed to purchase a further 0.351% NSR royalty interest on the Caserones mine, increasing their total effective NSR interest to 0.631%. 

"Following this Acquisition, Altus will receive significant quarterly royalty income and will have long-term exposure to copper. We expect the demand for copper to remain strong in the years ahead, as the global economy seeks to decarbonise in parallel with continued infrastructure development, urbanisation and wealth creation in emerging markets,” commented Poulton.

Looking ahead, he added: “Altus is currently assessing a number of other potential royalty acquisitions globally, alongside our on-going royalty generation programmes in Africa.”

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