Silver Crown Royalties Inc. (Cboe:SCRI, OTCQX:SLCRF, BF:QS0) has announced a definitive agreement to acquire a third 1% net smelter return (NSR) royalty on the Madre Sierra deposit owned by Titiminas Silver Inc. in Jauja, Peru. The transaction, valued at US$2 million in cash plus share-based considerations, underscores the company's commitment to expanding its silver royalty portfolio.
The acquisition adds to Silver Crown's existing royalties on the same project, aligning with its mandate to focus on silver. Peter Bures, CEO of Silver Crown, stated, "Our initial intent was to acquire the complete royalty package and eventually restructure the existing royalty into a silver-only royalty as per our mandate. Once this acquisition is completed, we intend to move forward with our silver-only strategy on Titiminas' Madre Sierra project. In time, we believe this royalty will become a very significant silver ounce contributor for our company."
Under the terms of the agreement, Silver Crown will pay US$2 million in cash at closing, plus US$1 million through the issuance of 38,401 units, each consisting of one common share and one-half warrant. The units will be priced at the volume-weighted average trading price of Silver Crown's shares on Cboe Canada for the five trading days preceding the agreement date. Warrants will be exercisable at 150% of the issue price for 24 months.
Additionally, a contingent payment of US$1 million will be satisfied through the issuance of similar units upon Silver Crown's receipt of the first royalty payment following at least 30 days of continuous production at a rate of 70 tonnes per day or more. The issue price for these units will be based on the five-day VWAP preceding the trigger date, with warrants exercisable at 150% of that price for 24 months.
The transaction is subject to customary closing conditions, including approval from Cboe Canada and registration of the royalty on title to the project. Closing is expected by October 31, 2026.
Silver Crown Royalties is a publicly traded silver royalty company with a portfolio of six silver royalties, three of which are currently generating revenue. The company's business model provides investors with exposure to precious metals, offering a hedge against currency devaluation while mitigating cost inflation risks associated with production. By acquiring additional royalties on the Madre Sierra project, Silver Crown aims to increase its silver ounce contributions and enhance shareholder value.
This strategic move comes as silver demand continues to grow, driven by industrial applications and investment demand. The Madre Sierra deposit, located in Peru, is a significant silver asset, and the additional royalty positions Silver Crown to benefit from its future production. The company's focus on silver-only royalties distinguishes it in the market, catering to investors seeking pure-play silver exposure.
The acquisition also reflects Silver Crown's proactive approach to consolidating royalties on high-quality projects. By increasing its stake in Madre Sierra, the company strengthens its portfolio and potential cash flows. Investors will be watching for the successful completion of the transaction and the project's progress toward production.
For more information, visit Silver Crown Royalties or see the full press release on NewMediaWire.
