Silver Wheaton Acquires Gold Streams From Vale's Salobo And Sudbury Mines

Silver Wheaton has agreed to acquire from a subsidiary of Vale 70% of the gold production from certain of Vale's Sudbury mines for a term of 20 years, and, through Silver Wheaton's wholly owned subsidiary Silver Wheaton (Caymans) Ltd., 25% of the life of mine gold production from Vale's Salobo mine. Production will accrue retroactively to Silver Wheaton as of January 1, 2013.

The term sheet remains subject to negotiation and execution of definitive agreements consistent with the terms of the term sheet, and to approval by the Vale S.A. board of directors. Vale S.A. has obtained approval of its Executive Committee of the Board and all other necessary internal committee approvals.

Upon closing, Silver Wheaton will pay Vale total cash consideration of US$1.90 billion, plus warrants to purchase 10 million shares of Silver Wheaton common stock at a strike price of US$65, and a 10 year term. In addition, the Company will make ongoing payments of the lesser of US$400 (plus an annual inflation adjustment starting in 2016 for the Salobo stream) and the prevailing market price, for each ounce of gold delivered under the agreement.

Vale is in the process of expanding the mill throughput at the Salobo mine to 24 million tonnes per annum (Mtpa) from its current 12 Mtpa.If the expansion to 24Mtpa is not completed by the end 2016, Silver Wheaton would be entitled to a gross up (a temporary increased percentage of gold production) based on the pro-rata achievement of the target production. If throughput capacity is expanded above 28Mtpa within a predetermined period, Silver Wheaton will be required to make an additional payment to Vale based on a set fee schedule ranging from US$67 million up to US$400 million, dependent on timing and scale.

FINANCING THE ACQUISITION

« First ‹ Previous 1 2 3 4 5 6 7 8 Next › Last »