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June 15, 2022

Elemental Royalties and Altus Strategies sign merger agreement

Upon closure of the deal, Elemental’s name is planned to be changed to Elemental Altus Royalties Corp.

Canada’s Elemental Royalties has struck a merger deal with Altus Strategies, whereby the share capital of the latter will be acquired to create a global gold royalty company.

Shareholders of Altus will receive 0.5940 shares in the new company for each share held.

Upon completion of the deal, Elemental’s name is planned to be changed to Elemental Altus Royalties Corp.

Elemental shareholders will own a 52.9% stake of the total issued share capital of the combined company while Altus shareholders will hold the remaining 47.1% interest.

The two companies said in a joint statement: “The boards of Elemental and Altus believe that the merger has compelling strategic logic and represents an attractive opportunity for both companies to create a global gold royalty company.”

New Elemental Altus Group will have a portfolio of 69 assets located across 13 jurisdictions, focused on tier-one mining jurisdictions. Of these assets, 11 are producing, primarily focused on gold.

The combined company, which is estimated to have combined adjusted 2022 revenues of $19.6m, will have an eight-member board comprising members from existing directors of both Elemental and Altus.

Altus CEO Steven Poulton believes that the merger will create a ‘strong and dynamic income-generating champion’ in the mining royalty space.

Poulton commented: “Our enlarged scale and combined revenues will not only enhance our access to further high-quality royalties but will also potentially reduce our cost of capital going forward.”

Elemental CEO and director Frederick Bell said that the deal will deliver materially increased revenue, scale and market relevance to both companies.

Bell stated: “The complementary nature of the portfolios and management teams alongside fast growing revenue from a portfolio of predominantly producing royalties will deliver significant benefits to shareholders.

“In addition, the combined company will have a low-cost royalty generation business arm to complement the continuing acquisition of producing royalties.”

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