Eagle Royalties (ER.C) has announced it has entered into a definitive agreement with Summit Royalty Corp, a private royalty company, whereby the latter will acquire Eagle Royalties in an all-stock deal and use Eagle as its listing vehicle for a Reverse Take Over. Upon completion of the transaction, Eagle Royalties shareholders will retain a stake of approximately 20% in the combined entity while the Summit Royalty shareholders will retain 80%. No concurrent financing was mentioned in the announcement.
Although the combining entity will have some interesting royalties and streams, but it is a pity there isn’t a whole lot of information available on Summit Royalty to determine if the 20/80 ownership ration in the resulting entity is fair.
As this essentially is a go-public transaction for Summit, it’s the Summit Royalty management team and board of directors that will take the reigns after the completion of the transaction.
Disclosure: The author has a small long position in Eagle Royalties. Eagle is a sponsor of the website. This post is for educational purposes only; be mindful investing in junior mining stocks is risky and you may lose your entire investment if things go wrong. Please read the disclaimer.
