KGC - Royal Gold to buy Great Bear Royalties in C$200M deal

Royal Gold ( NASDAQ: RGLD ) said on Monday it agreed to acquire Great Bear Royalties ( OTCPK:GBRBF ) for C$6.65/share, or C$199.5M in cash.

Great Bear's ( OTCPK:GBRBF ) only material asset is a 2% net smelter return royalty that covers all of the Great Bear Project in Ontario, indirectly owned and operated by Kinross Gold ( KGC ).

Great Bear said it entered into a co-operation agreement with Kinross ( KGC ) that provided access to Kinross personnel and certain non-public information pertaining to the project; in exchange, Great Bear amended certain terms of the royalty agreement upon closing of the acquisition, including providing an option to Kinross to purchase a 25% interest in the royalty for an amount equal to 25% of purchase price of Great Bear, adjusted for inflation.

The Great Bear Project, Canada's newest major gold discovery, is considered an "emerging world class gold project with long-term growth potential."

Royal Gold's ( RGLD ) organic growth pipeline allows it to grow earnings even with flat metal prices, Taylor Dart writes in an analysis posted on Seeking Alpha .

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