Fort Capital is pleased to announce that Noranda Income Fund (TSX:NIF.UN) (“Noranda”) and BaseCore Metals LP (“BaseCore”) have entered into a definitive stream agreement (the “Stream Transaction”), which represents the first stream of its kind on a smelting operation.
Noranda will sell 1.00% of zinc processed and refined at its processing facility located in Quebec (the “Processing Facility”) until the later of ten years or when 68 million pounds of zinc have been delivered. Noranda will receive ongoing payments equal to 20% of the zinc LME cash settlement price at the time of delivery. BaseCore will pay US$40 million for the zinc stream in three separate tranches.
The proceeds from the Stream Transaction will be used to fund expansion and efficiency projects that will allow Noranda to expand zinc production capacity at the Processing Facility by ~20,000 tonnes per annum and maintain its position as a leading zinc smelter in North America.
Fort Capital Partners acted as Financial Advisor to Noranda on the Stream Transaction.
Noranda Income Fund is an income trust that owns the Processing Facility in Québec. The Processing Facility was commissioned in 1963 and is the second-largest zinc processing facility in North America, and the largest zinc processing facility in eastern North America. It produces refined zinc metal and by-products from sourced zinc concentrates. The Processing Facility is operated and managed by Canadian Electrolytic Zinc Limited, a wholly-owned subsidiary of Glencore Canada Corporation.
BaseCore Metals LP, an independent 50/50 joint venture between Glencore and Ontario Teachers’ Pension Plan Board, is a base metals focused streaming and royalty company. BaseCore provides strategic, long-term and friendly financing to mining operators giving them superior access to capital for funding of exploration and development, mine expansions, mergers and acquisitions, balance sheet flexibility and reclamation obligations.