Gold Royalty Corp. (NYSE American: GROY) entered into a $45 million agreement to acquire a net smelter royalty on the Borborema gold mine, a producing asset operated by Aura Minerals Inc. in Rio Grande do Norte, Brazil. The deal consists of $30 million in cash and 3,571,429 newly issued GROY shares, priced at a 20‑day volume‑weighted average price of $4.20 per share.
The new royalty grants GROY 1.5 % of net smelter returns on the first 1.5 million ounces of payable gold production and 1.0 % thereafter up to 2.0 million ounces, after which the royalty expires. This addition expands GROY’s existing 2.0 % net smelter royalty on the same mine, which steps down to 0.5 % after 725,000 ounces and includes a buyback clause after 2.25 million ounces or by 2050. By doubling its exposure to the Borborema mine, GROY strengthens its portfolio of high‑quality, long‑life gold assets in the Americas, aligning with its strategy of building a diversified royalty and streaming business.
The transaction will be funded through a mix of cash and equity, resulting in a modest dilution of existing shareholders. The share issuance is based on a 20‑day VWAP of $4.20, reflecting the market value of GROY’s stock at the time of the deal. The $30 million cash component is drawn from GROY’s liquidity, while the equity portion allows the company to preserve cash for future growth initiatives and to maintain a strong balance sheet as it pursues additional acquisitions.
Aura Minerals announced commercial production at Borborema on September 22 2025, and the mine processed 4,500 tonnes per day at 80 % of design capacity. In Q4 2025, Aura produced 15,777 gold‑equivalent ounces, a 54 % increase over the previous quarter, underscoring the asset’s rapid ramp‑up and strong production trajectory. The royalty’s step‑down structure ensures that GROY benefits from the mine’s early high‑output phase while limiting exposure once production reaches the 2.0 million‑ounce threshold.
Gold Royalty Chairman and CEO David Garofalo said the acquisition “demonstrates how our network of relationships and disciplined capital allocation can unlock value in high‑quality assets.” He added that the deal “fits neatly into our growth plan, which focuses on acquiring producing gold royalties that deliver predictable cash flows and support our long‑term free‑cash‑flow goals.”
The transaction is expected to close in January 2026, subject to customary conditions. Taurus Mining Royalty Fund has expressed interest in acquiring a 50 % economic interest in the royalty for $22.5 million, contingent on the deal’s completion, providing an external validation of the asset’s value and helping GROY manage its capital outlay.
By adding this royalty, GROY not only increases its exposure to a producing gold mine but also positions itself to benefit from the mine’s projected growth trajectory and the favorable terms of the royalty structure. The deal aligns with GROY’s broader objective of building a diversified portfolio of high‑quality, long‑life gold assets while maintaining a strong balance sheet and a disciplined approach to capital deployment.
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