26 April 2017
International law firm Watson Farley & Williams (“WFW”) has advised AIM and TSXV listed Mariana Resources Limited (“Mariana”) on its £166.85m combination (the “Combination”) with Sandstorm Gold Ltd (“Sandstorm”), which is listed on NYSE MKT and TSX.
Under the terms of the Combination, Mariana shareholders will receive 0.2573 new Sandstorm shares and 28.75 pence in cash for each Mariana share held. If successful, the Combination will result in Mariana shareholders owning approximately 18.3% of the enlarged Sandstorm group (the “Combined Group”). It is intended that the Combination will be implemented by way of a court-sanctioned scheme of arrangement under Part VIII of the Companies (Guernsey) Law.
The Combination is expected to create a leading mid-tier stream and royalty company. Stream and royalty finance involves making an upfront payment to a mining partner that is in need of capital to build their mine, refinance their obligations, complete an acquisition or for various other reasons. In exchange for that upfront payment, Sandstorm receives the right to purchase a percentage of the gold produced from the mine (in the case of a stream) or a portion of the revenue generated from the mine (in the case of a royalty).
The Combined Group will have:
The cross-border WFW team advising Mariana was led by Partner Jan Mellmann, Head of WFW’s Global Natural Resources Group. Jan was assisted in London by Corporate Senior Associates Jenny Hodges and Richard Collinson, Corporate Associate Danny Perera and Trainee Alex Clark. WFW New York Partners Steven Hollander and Stephen Millman advised on the US aspects of the transaction, assisted by Associate Daniel Berger.
Jan commented: “We advised Mariana on its listing on AIM in 2006 and throughout its development since, so were delighted to be able to use our significant mining and capital markets experience again to help Mariana and its shareholders to achieve a successful exit via the Combination with Sandstorm”.
Glen Parsons, CEO of Mariana, commented: “We would like to thank WFW and all of our global team on a well-executed process which hopefully leads to a successful Combination with Sandstorm. This Combination is a significant transaction for Mariana shareholders, and one that the Independent Directors have recommended”.
Guernsey legal advice was provided by Helen Wyatt (Partner) and Alex Davies (Senior Associate) at Mourant Ozannes. Canadian legal advice was provided by Cyndi Laval (Partner), Stefan McConnell (Counsel) and Raymond Ong (Associate) at Gowling WLG.