Gold Royalty Corp. (GROY) increased the size of its existing revolving credit facility to $75 million, adding an accordion provision for an additional $25 million that can be drawn under customary conditions. The new facility carries a leverage‑based interest rate ranging from SOFR plus 2.5 % to 3.5 % and extends maturity to November 2028, replacing the prior SOFR‑plus‑3.0 % margin arrangement and providing a lower cost of borrowing.
On the same day, the company exercised its early redemption rights on its outstanding 10 % convertible debentures issued in December 2023. The $40 million debentures were redeemed through a make‑whole payment that consisted of 70 % cash and 30 % common shares at a conversion price of $1.75 per share. The transaction resulted in the issuance of 23,288,896 new common shares and the complete elimination of the debentures, removing a fixed 10 % interest obligation from the balance sheet.
The combined effect of the facility upsizing and debenture redemption is a significant reduction in interest expense and an improvement in liquidity. By replacing the higher‑coupon debentures with a lower‑rate credit line, Gold Royalty reduces its annual debt‑service cost and frees cash that can be deployed toward future acquisitions or royalty investments. Chief Financial Officer Andrew Gubbels noted that the transaction “significantly improves our balance sheet, lowers our cost of capital and results in a more fiscally efficient capital structure.”
The move builds on a recent history of strengthening the company’s credit profile. In February 2025, Gold Royalty had already upsized its revolving credit facility to $75 million with a maturity of March 31 2028. The December 2023 debenture issuance financed flagship projects such as the Borborema royalty and a gold‑linked loan, which have generated $7.2 million in cash flows and entered commercial production in Q3 2025. The company’s Q3 2025 results—record revenue of $4.6 million and adjusted EBITDA of $2.5 million—demonstrate operational strength that underpins its ability to secure favorable financing terms.
While no immediate market reaction data is available, the transaction is material for long‑term investors. The elimination of high‑interest debt and the lower‑cost credit line enhance Gold Royalty’s financial flexibility, positioning the company to pursue strategic growth opportunities and potentially acquire additional royalty or streaming assets. The CFO’s emphasis on a stronger balance sheet signals confidence in the company’s ability to generate cash and support future expansion.
The overall impact is a more robust capital structure, reduced financial risk, and a clearer path to funding future growth initiatives. By tightening its debt profile and securing a lower‑rate credit facility, Gold Royalty is better positioned to capitalize on opportunities in the metals and mining sector while maintaining a healthy liquidity buffer.
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