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New Gold Royalty makes strong start

New royalty kid on the block Gold Royalty has made a strong start, having trebled its proposed IPO to raise US$90 million and closing higher to finish its first week on the NYSE American.
New Gold Royalty makes strong start New Gold Royalty makes strong start New Gold Royalty makes strong start New Gold Royalty makes strong start New Gold Royalty makes strong start

Gold Royalty Corp’s interests

Staff reporter

Gold Royalty, headed by former Goldcorp boss David Garofalo, was spun out of junior explorer GoldMining under plans mooted last year.

Gold Royalty was originally proposing to issue 6 million units under its IPO priced at $5.

It doubled this to offer 12 million units in February, then further increased it to up to 16 million units this month, before closing it last week having offered 18 million units for gross proceeds of $90 million.

GoldMining said it continued to hold 20 million shares in the royalty spinout, or about 49%.

Gold Royalty had also granted underwriters a 30-day option to purchase a further 2.7 million shares, and/or up to 1.35 million warrants at the IPO price.

"GRC plans to use the net proceeds from the offering to implement its growth and acquisition strategy and for other general working capital purposes," it said.

It said it had net smelter return royalties on 18 gold properties, of which 17 were owned by GoldMining, and the rights to acquire nine royalty interests from third parties holding royalties on some of those properties.

Its shares (NYSE American: GROY) began trading on March 9, starting about $3.80 before closing up 5.9% to $5 on Friday to capitalise it at $204 million.