Gold Royalty Corp. (NYSE American: GROY) has agreed to purchase the Pedra Branca royalty from BlackRock World Mining Trust plc for $70 million in cash. The royalty grants a 25 % net‑smelter return (NSR) on gold and a 2 % NSR on copper and other products from the Pedra Branca mine, an operating copper‑gold operation in Brazil owned and run by a BHP Group subsidiary. The deal will close on or about December 11, 2025, after customary closing conditions and regulatory approvals are satisfied.
The acquisition adds a new cash‑flowing asset to Gold Royalty’s portfolio, bringing the total number of such royalties to eight. It also introduces a Brazilian asset, diversifying the company’s geographic exposure beyond the Americas and adding copper to a portfolio that has been heavily weighted toward gold. Management expects the royalty to provide immediate and material additions to cash flows, reinforcing the company’s strategy of building a high‑quality, cash‑generating royalty base and supporting its goal of a net‑debt‑free balance sheet by the end of 2026.
To fund the purchase, Gold Royalty completed a bought‑deal offering of 17.5 million common shares at $4.00 per share, raising $70 million in gross proceeds. The equity raise is dilutive, which explains the 5.6 % pre‑market decline in the company’s stock on the day of the announcement. Investors focused on the dilution impact rather than the strategic upside, as the share offering is not contingent on the royalty closing and represents a significant capital‑structure change.
CEO David Garofalo highlighted the deal’s alignment with the company’s growth plan, noting that the Pedra Branca royalty “provides an immediate and material addition to our cash flows” and “enhances our leverage to gold and copper.” He reiterated the company’s target of becoming essentially debt‑free by 2026, a milestone that the new royalty is expected to accelerate by adding a steady, high‑quality revenue stream to the balance sheet.
The broader market context supports the acquisition’s strategic logic. Copper demand is underpinned by the global transition to renewable energy, while gold remains a safe‑haven amid commodity price volatility. The Pedra Branca mine’s production began in 2020, and its copper‑gold blend offers a balanced commodity mix that can help mitigate price swings. However, the company must manage the dilution from the equity raise and monitor copper price dynamics, which could affect the royalty’s cash‑flow profile in the short term.
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