Commodities & Metals

Royal Gold Buys into Another Mine (RGLD, TCK)

Royal Gold, Inc. (NASDAQ:RGLD) has agreed to purchase an interest in a Chilean gold mine owned by Teck Cominco Ltd. (NYSE:TCK) for $100 million in cash and about 4.5 million shares of Royal Gold common stock. The company also announced that it would issue 6.5 million new shares of common stock on its existing shelf registration to pay for the acquisition.

In the deal with Teck, Royal Gold will receive 75% of the gold from a portion of the mine until 910,000 ounces have been sold. At that point, Royal Gold will get 50% of all future production from the property. Teck estimates that there are 1.6 million ounces of gold in the portion of the mine that Royal Gold has acquired an interest in.

The acquisition is subject to a marketing deal, government approvals, and completion of due diligence. The underwriters for the stock offering have a 30-day over-allotment option for 975,000 shares.

Teck expects to complete a currently under-construction project to begin production by the end of 2009. Commercial production is expected in the first half of 2010.

Royal Gold shares are down about 5% on the news, probably with gold itself, while Teck shares are up slightly.

Paul Ausick
April 6, 2009

100 Million Americans Are Missing This Crucial Retirement Tool

The thought of burdening your family with a financial disaster is most Americans’ nightmare. However, recent studies show that over 100 million Americans still don’t have proper life insurance in the event they pass away.

Life insurance can bring peace of mind – ensuring your loved ones are safeguarded against unforeseen expenses and debts. With premiums often lower than expected and a variety of plans tailored to different life stages and health conditions, securing a policy is more accessible than ever.

A quick, no-obligation quote can provide valuable insight into what’s available and what might best suit your family’s needs. Life insurance is a simple step you can take today to help secure peace of mind for your loved ones tomorrow.

Click here to learn how to get a quote in just a few minutes.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.