VANCOUVER — Depressed base metal prices have created a strong deal-making environment for precious-metal streaming companies, and industry leader Franco-Nevada (TSX: FNV; NYSE: FNV) is ready to take advantage. On Feb. 10 the company unveiled its latest transaction, wherein it will pay US$500 million for a silver-gold stream from Glencore’s (LON: GLEN) large-scale Antapaccay copper mine in Peru’s Cusco Region.
Under terms of the deal Franco’s initial silver and gold deliveries will be determined by reference to copper shipments. The company will receive 300,000 oz. gold for every 1,000 tonnes of copper in concentrate, and 30% of gold in concentrate after 630,000 oz. have been delivered.
In terms of silver, Franco will receive 4,700 oz. for every 1,000 tonnes of copper in concentrate, and 30% of silver in concentrate after 10 million oz. have been delivered.