Wednesday, May 22, 2024

Electric Royalties Expands Lithium Royalty Portfolio through Strategic Acquisition in Ontario, Paving Way for Future in Mining Industry


Electric Royalties Advances its Portfolio with Strategic Lithium Acquisition

Electric Royalties Ltd. is making significant strides in the mining industry with its recent strategic move to expand its lithium royalty and option portfolio. This development comes through an Asset Purchase Agreement with 1544230 Ontario Inc., MK Exploration Services Inc., and Gravel Ridge Resources Ltd., aiming to acquire 18 royalty agreements alongside 32 highly prospective lithium properties in Ontario, Canada.

The properties, currently under exploration by third-party entities through option agreements, have the potential to significantly bolster Electric Royalties’ position in the lithium market. Upon the fulfillment of the option payments, which could provide up to C$2.2 million to the company over the next two and a half years, and the exercise of the options, these properties will transform into royalty interests for Electric Royalties. Moreover, the company will maintain the right to manage any properties that don’t transition to optionees by re-optioning, selling, or renouncing them.

Transaction Details

To seal the deal, Electric Royalties will issue 2,250,000 common shares to the Vendors and make a significant cash payment, taking into account adjustments for previous payments and earnings post-January 1, 2024. Slated for completion in April 2024, this ambitious transaction is subject to various conditions, including due diligence, TSX Venture Exchange approval, and other regulatory consents.

Funding the Future

In a bid to finance the cash portion of the transaction and associated costs, Electric Royalties has opted to draw down C$2,500,000 under its convertible credit facility with Gleason & Sons LLC. This drawdown is part of a larger C$10,000,000 credit facility, established to support the company’s working capital and future endeavors. The terms of the credit are strategically designed, with interest rates fluctuating based on the SOFR, and the option for the lender to convert the drawn amount into common shares of Electric Royalties, subject to TSX Venture Exchange approvals.

About Electric Royalties Ltd.

Electric Royalties stands at the forefront of the electrification revolution, leveraging the increasing demand for lithium and other essential commodities necessary for electric vehicles, battery production, and renewable energy generation. The company’s focus on acquiring royalties in advanced stage and operational projects reflects a strategic effort to build a diversified portfolio in jurisdictions with minimized geopolitical risks, offering investors a prime opportunity to engage with the clean energy transition.

With this latest acquisition, Electric Royalties is set to enhance its growing portfolio, now encompassing 40 royalties worldwide and 32 lithium properties in Ontario, Canada. This not only solidifies its market position but further exemplifies the company’s commitment to supporting the global shift towards a decarbonized economy through strategic investments in critical minerals.

Forward-Looking Statements

This press release contains forward-looking information that involves various risks and uncertainties regarding future events. These statements reflect the company’s current expectations concerning future events and operation performance and speak only as of the date of this release. There is no assurance that these events will occur or that the company’s expectations will be achieved. Factors that could cause actual results to differ materially include risks related to the mining industry, economic conditions, and regulatory developments.

Electric Royalties’ innovative approach to securing and developing lithium properties and royalty agreements not only demonstrates its leadership in the renewable energy sector but also positions it as a key player in powering the future of electrification and sustainable energy solutions worldwide.

Alexandra Bennett
Alexandra Bennett
Alexandra Bennett is a seasoned business journalist with over a decade of experience covering the global economy, finance, and corporate strategies. With a Bachelor's degree in Economics and a Master's in Business Journalism from Columbia University, Alexandra has built a reputation for her insightful analysis and ability to break down complex economic trends into understandable narratives. Prior to joining our team, she worked for major financial publications in New York and London. Alexandra specializes in mergers and acquisitions, market trends, and economic

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