Lundin Gold Inc. ($LUG) is excited to announce a binding term sheet with LunR Royalties Corp. for a proposed $670 million silver stream-for-equity transaction. This deal is based on the 20-day volume weighted average price (VWAP) of LunR shares on the TSX Venture Exchange (TSXV) as of February 20, 2026.
Under the terms of this transaction, Lundin Gold will sell a silver stream from its Fruta del Norte (FDN) mine in Ecuador in exchange for newly issued shares of LunR. Once the transaction closes, the LunR shares received by Lundin Gold, referred to as the Consideration Shares, will be distributed to Lundin Gold shareholders as a dividend-in-kind. Lundin Gold will not retain any LunR shares after this distribution.
Brendan Creaney, Vice President of Corporate Development and Investor Relations, stated, "This proposed transaction allows us to unlock significant value for our shareholders while maintaining full gold exposure to the world-class Fruta del Norte mine. By converting a small by-product into an equity interest in a rapidly emerging royalty company, we are crystallizing value now and creating a new avenue of long-term value for our shareholders. LunR's participation in this transaction underscores their confidence in FDN's exceptional quality and its exploration potential to continue delivering silver for many years to come. This proposed transaction presents a unique opportunity for our shareholders to participate as owners with direct exposure to both companies."
Following the transaction's closing, Lundin Gold intends to distribute the Consideration Shares to its shareholders as soon as reasonably practicable. However, this distribution will not occur in jurisdictions where it may be restricted or prohibited by applicable law, including the United States. In such cases, the Consideration Shares will be sold on behalf of those shareholders, who will receive a cash payment equivalent to the net proceeds of the sale.
Further details regarding the distribution structure and timing will be provided as the transaction progresses. The deal has been unanimously approved by Lundin Gold's Board of Directors and is classified as a related party transaction under MI 61-101.
Closing the transaction is contingent upon several regulatory, corporate, and documentation requirements, with expectations set for Q2 2026. Lundin Gold operates the Fruta del Norte mine, known as one of the highest-grade operating gold mines globally, and is dedicated to responsible operations and community benefits.
LunR Royalties, based in Canada, focuses on managing a portfolio of mining royalty and stream interests to build lasting value for stakeholders. LunR was spun out of NGEx Minerals Ltd., which holds net smelter return (NSR) royalties on significant projects in Argentina and Chile.
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