The streaming and royalty space has heated up in the recent months, amid at a bullish outlook for the commodities space, leading to a rally in metal prices. Here is a quick breakdown on how streaming and royalty companies operate:
- Royalty and streaming companies provide funds for mines in exchange for future payoffs.
- Royalty companies receive a fixed percentage of the revenue generated by a mine, while streaming companies receive physical metals.
- The benefit for these companies is larger profit margins, less exposure to risks, and diversification while still being in the mining industry.
Sailfish Royalty (TSX.V: FISH) is a precious metal focused royalty and streaming company. The company has been acquiring royalties and streams on assets since 2014, and did an IPO in 2018. Within Sailfish's portfolio, the company has assets from exploration to production stage including:
- a gold stream equivalent to a 3% NSR royalty on the San Albino gold project (Mako Mining TSX.V:MKO) (approximately 3.5 square Km) and a 2% NSR royalty on the rest of the area (approximately 134.5 square Km) surrounding San Albino in northern Nicaragua;
- 1.5% NSR on The El Compas Silver Mine (Endeavour Silver TSX: EDR)
- up to a 3.5% NSR royalty on the Tocantinzinho gold project (Eldorado Gold TSX: ELD) in the prolific Tapajos district of northern Brazil;
- The acquisition of Terraco Gold Corp. adds a potential cornerstone asset: an up to 3% NSR royalty on the multimillion-ounce Spring Valley gold project in Pershing County, Nevada.
Sailfish’s (TSX.V: FISH) stream equivalent to a 3% NSR on the high-grade San Albino gold project, is a part of the San Albino-Murra concession (8,700 hectares) within a larger contiguous land package of approximately 18,817 hectares. The San Albino high-grade gold project is located approximately 173 kilometers north of Managua, the nation’s capital, and approximately 15 kilometers southeast of the northern border of Nicaragua with Honduras.
Gold grades typically associated with high-cost underground mining are amenable to low-cost open pit mining at San Albino. The current 43-101 resource stands at:
The El Compas Royalty adds revenues to Sailfish’s balance sheet, as it is a producing mine operated by Endeavour Silver (TSX: EDR). El Compas is Endeavour Silver’s fourth and highest-grade silver equivalent mine located in Zacatecas, the 3rd largest historic silver mining district in Mexico. The fully permitted mine and leased plant were acquired in 2016. Endeavour is currently developing by mechanized, underground, ramp access the El Compas and El Orito veins for production starting in April 2018 and the 500 tpd plant is being refurbished for 325 tpd initially. For the year 2020, The El Compas Mine produced 0.8Moz of Silver Equivalent (based off information on Endeavour Silver’s website: https://www.edrsilver.com/English/home/default.aspx).
Sailfish Royalty’s (TSX.V: FISH) shareholders are some of the largest players in the Natural Resource space: Wexford Capital LP currently owns 54% - Wexford is a value-oriented multi-strategy investment firm that has been capturing risk-adjusted returns across public and private markets since its inception in 1994. Stephens Investment Management 6% - Stephens specializes in domestic equity investment management focused on small and mid-capitalization growth companies. We truly have a passion for discovering the next great growth story among the vast universe of small and mid-sized companies. Management and Directors currently own 10%, with the remaining 30% owned by other.
The company (TSX.V: FISH) is run by a team of highly successful executives and geological professionals:
Cesar Gonzalez Co-Founder and CEO
Cesar Gonzalez co-founded and serves as the CEO and a Director of Sailfish Royalty Corp. Previously, Cesar served as the VP Corporate Development and a Director of Marlin Gold Mining Ltd. through the construction and commissioning of the La Trinidad gold mine, the spinout of Sailfish Royalty Corp. and the acquisition of Marlin by Golden Reign Resources Ltd. to form Mako Mining Corp. He also serves as the VP Corporate Development of Mako, the Executive Chairman at Bonterra Resources Inc. and as a consultant at Wexford Capital LP. Previously, he worked at Lehman Brothers as an Associate in the Private Equity Group where he focused on investments in energy master limited partnerships. Cesar graduated from the University of Southern California, where he earned a B.S. in Business Administration.
Akiba Leisman Co-Founder and Executive Chairman
Akiba Leisman co-founded and serves as the Executive Chairman and a Director of Sailfish Royalty Corp. Previously, Akiba was Executive Chairman and Interim CEO of Marlin Gold Mining Ltd., leading the company through the spinout of Sailfish and the acquisition of Marlin by Golden Reign Resources Ltd. to form Mako Mining Corp. He also serves as the CEO and a Director of Mako, a Director at Bonterra Resources Inc. and as a consultant at Wexford Capital LP. Prior to Wexford, he was a Senior Analyst at Red Kite Capital Management for the Mine Finance funds where he was responsible for senior secured investments on metal mining assets. Previously, he was an Associate at Standard Bank working in the Structured Commodity Products and Mine Finance groups. Akiba has an MBA from New York University, and a B.S. in Chemical Engineering from Carnegie Mellon University.
Bryan McKenzie, CPA, CA CFO
Bryan McKenzie is a mining industry professional with more than 15 years of experience. He brings a varied knowledge of finance, tax, accounting, auditing and public markets and has been directly involved in corporate transactions including mergers, acquisitions and financings in excess of $500 million. Bryan holds a Bachelor of Technology in Accounting from the British Columbia Institute of Technology and is a Chartered Accountant.
Sailfish Royalty (TSX.V: FISH) has 75M shares outstanding, and is currently trading at $1.08, giving it a market cap of $81M.
The company also owns 100% interest in the Gavilanes Property, a highly prospective asset located in the San Dimas mining district, Durango State, Mexico. This asset is 25Km east San Dimas mine owned and operated by First Majestic Silver (TSX: FR). Sailfish currently has a number of options for Gavilanes, with a spin-co being the ideal situation. In this case, every current shareholder in Sailfish Royalty (TSX.V: FISH) will get shares in the new company.
Sailfish Royalty (TSX.V: FISH) continues to be one of the leading streaming and royalty firms, their current portfolio looks to be very exciting as each individual mine hits milestones.
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