Fort Capital Partners is pleased to announce its role as financial advisor to Wheaton International’s acquisition of a new silver stream from Capstone’s Cozamin Mine.
Wheaton Precious Metals™ Corp. (“Wheaton” or the “Company”) has announced that its wholly-owned subsidiary, Wheaton Precious Metals International Ltd. (“Wheaton International“) has entered into a definitive Precious Metal Purchase Agreement (the “Stream Transaction“) with Capstone Mining Corp. (“Capstone“) (TSX: CS) in respect to Capstone’s Cozamin Mine located in Zacatecas, Mexico.
Wheaton International will pay Capstone upfront cash consideration of US$150 million upon closing for 50% of the Cozamin’s silver production until 10 million ounces (“Moz“) have been delivered, thereafter dropping to 33% of silver production for the life of the mine. In addition, Wheaton will make ongoing payments for silver ounces delivered equal to 10% of the spot silver price. The Precious Metal Stream is effective December 1, 2020.
Cozamin is a copper mine that has been operated by Capstone since 2006. Subsequent to the closing of this acquisition, the addition of Cozamin will increase Wheaton’s estimated Proven and Probable silver reserves by 6.8 Moz, Measured and Indicated silver resources by 10.8 Moz and Inferred silver resources by 6.3 Moz.
Significant exploration upside potential exists. Proven and Probable silver reserves for Cozamin as of April 30, 2020, increased by over 100% from the prior year, and Measured and Indicated silver resources increased by over 70%. Capstone is also in the process of completing a pre-feasibility study of an underground paste backfill system for Cozamin that could potentially increase the extraction ratio as mining pillars are currently excluded in the existing mine plan.
Fort Capital acted as Financial Advisor to Wheaton International on the Stream Transaction.