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The Metals Royalty Company Announces Closing of Additional 1.0% Mesabi Royalty and US$165 Million Financing

TMCTMCR
  • TMCR closed on acquiring an additional 1.0% Index-Priced Gross Overriding Production Royalty with a Revenue Floor in the Mesabi Project from Ironclad, doubling its total interest to 2.0%.
  • The acquisition is funded via a US$140 million offering of 8.00% convertible senior secured second lien notes due 2031 anchored by EdgePoint Investment Group & a US$25 million senior secured term loan from Macquarie.
  • TMCR anticipates annual royalty revenue of approximately US$22 million based on 7.28 Mtpa production, with potential to reach US$26 million if the project expands to 8.5 Mtpa.
  • The Mesabi Project is reported 99% complete, with first processing line commissioning targeted for Q3 2026 & first production for Q4 2026.
  • Proceeds from the financing were used to fund the acquisition, repay TMCR's existing senior term loan facility in full, & support general corporate purposes.
  • TMCR retains a 2.0% gross overriding royalty on the NORI polymetallic nodule project operated by The Metals Company Inc., with commercial recovery permitting expected ahead of Q4 2027 offshore commissioning.
  • The 8.00% convertible notes have a principal amount of US$140 million, a maturity date of September 15, 2031, & an initial conversion price of US$8.6625 per share.
  • The senior secured term loan facility carries a rate of Term SOFR plus 4.00% per annum, has a 24-month maturity with a 12-month extension option, & includes 500,000 common share purchase warrants.
  • Share consideration for the royalty purchase was increased to US$27.5 million, resulting in the issuance of 4,365,079 common shares to Mesabi Investments, while cash consideration was reduced.
  • Net proceeds from the combined offerings totaled approximately US$150.9 million after deducting fees, expenses, & original issue discounts.