Sailfish Royalty Corp. has entered into a non-binding letter of intent with Mako Mining Corp. for a 20-year gold purchase agreement that will result in Mako acquiring a 48.54% stake in the royalty company. Under the proposed transaction, Sailfish will issue 70 million common shares at $5.76 per share to purchase refined gold over a 240-month term.

The delivery schedule starts at 650 troy ounces per month until August 1, 2028, rising to 750 ounces per month until February 1, 2031, and 900 ounces per month until February 1, 2037. For the remainder of the term, deliveries will scale to 1,000 ounces per month. For each ounce delivered, Sailfish will pay 25% of the London Bullion Market Association PM fix price using working capital. Mako’s delivery obligations will be secured against its present and after-acquired property, excluding the Mt. Hamilton Gold Silver Project.

Completion of the arrangement remains conditional on negotiating a definitive agreement, receiving acceptance from the TSX Venture Exchange, and securing approvals from both Sailfish and Mako shareholders.

The agreement anchors plans to reshape Sailfish’s capital return policy. Following closing, the company intends to pay a special dividend of US$1.00 per common share and implement a gold price-linked quarterly dividend. The revised payout will equal one-quarter troy ounce of gold annually for every 18,000 shares held, paid quarterly in arrears based on the trailing three-month average PM fix price.

“This transaction, coupled with the anticipated enhancement to our dividend policy, is expected to increase Sailfish's leverage to the gold price and should allow its shareholders to have direct exposure to the current gold market through our dividend. Importantly, this transaction sets the foundation for a broader relationship between Sailfish and producing gold companies. We intend to build on this model through the potential for future transactions that could increase the gold- linked dividend payment.”

— Paolo Lostritto, CEO

The San Albino gold mine, where Sailfish holds a royalty interest, previously reported a Measured and Indicated mineral resource of 670,100 tonnes at 11.61 grams per tonne gold for 250,200 ounces. Earlier this year, Sailfish completed the sale of its wholly owned subsidiary Terraco Gold Corp. to OR Royalties Inc. for after-tax cash consideration of $168 million.

Read the full announcement: Sailfish Enters Into Non-Binding 20-year Gold Purchase Agreement with Mako Mining; Plans to Implement a Gold Price-Linked Dividend and Declare Special Dividend of US$1 per Share