The company said Fairfax Financial Holdings Ltd., through certain of its affiliates, exercised 6.67 million common share purchase warrants at an exercise price of $15 per common share in the capital of Altius for gross proceeds of $100 million.
In accordance with the terms of the warrants and preferred security indenture dated April 26, 2017 between the company and TSX Trust Company governing Atius’s 5.0% subordinate preferred securities, Fairfax has elected to pay the exercise price of the warrants by surrendering its $100 million preferred securities to Altius for cancellation.
That’s in full satisfaction of the exercise price payable in respect of the warrants, which along with the preferred shares, were originally issued on April 26, 2017.
Following completion of the transaction, Fairfax will directly or indirectly own or control 6.67 million common shares, which represents 13.94% of the issued and outstanding common shares as of April 14, 2022 on a non diluted basis.
Altius will have no outstanding warrants, preferred securities or resulting interest distribution obligations.
Altius shares were virtually unchanged on the news, easing 0.48% or 12 cents to $24.61. The shares currently trade in a 52-week range of $25.68 and $14.92.
Altius directly and indirectly holds diversified royalties and streams that generate revenue from 13 operating mines, located in Canada and Brazil. These operations produce copper, zinc, nickel, cobalt, iron ore, potash and thermal (electrical) and metallurgical coal.
Altius also holds a large portfolio of exploration stage projects which it has generated for deal making with industry partners that results in newly created royalties and equity and minority interests. Altius also has a 59% stake in Altius Renewable Royalties Corp [ARR-TSXV], which holds royalties related to renewable energy projects.
The company recently said the market value of equities in its public junior equities portfolio (as of March 31, 2022) stands at $67.3 million, up from $55.5 million in December 31, 2021. The primary driver of the increase in portfolio valuation in the quarter was due to the receipt of shares from three different public issuers related to projects sold by Altius, including:
- 0 million common shares or a 16.8% stake in newly-listed Labrador Uranium Inc. [CSE-LUR] for the sale of the company’s Labrador uranium projects in late 2021.
- 4 million shares or a 19.9% stake in High Tide Resources Inc [CSE-HRTC] for the sale of the company’s Labrador West (Goethite Bay) iron ore project in 2019.
- 8 million common shares of Technology Minerals Plc [TM1-LON], for the sale of the company’s interest in the Metastur copper-cobalt project joint venture in Austurias, Spain in late 2021.
Altius holds an equity stake in Adventus Mining Corp. [ADZN-TSXV, ADVZF-OTCQX]. Adventus and Salazar Resources Ltd. [SLR-TSXV] recently secured US$235.5 million for development of the Curipamba Copper Project in Ecuador via financing deals with Wheaton Precious Metals Corp. (WPM-TSX, WPM-NYSE) and Trafigura Pte Ltd.
Curipamba, held 75% and Adventus and 25% by Salazar, is forecast to be a high-margin mine in the lowest half of the copper cost curve with a 10-year open-pit mine life and the potential to transition into an underground mine subsequent to the open pit. Altius holds a 2.0% NSR royalty covering the Curipamba project.