Acacia Mining has reached into an agreement with Sandstorm Gold Ltd for the disposal of its non-core royalty over the Houndé Mine in Burkina Faso for total consideration of US$45 million.
The existing 2% net smelter royalty has been owned by Acacia and its predecessor companies since 2010. Following a competitive process the royalty has been purchased by Sandstorm Gold Ltd, a TSX- and NYSE-listed company.
Acacia’s decision to dispose of this royalty follows the announcement of commercial production at the mine in October and is in line with their capital allocation plans. The transaction is expected to close in early Q1 2018 and, together with the measures taken at both Bulyanhulu and Buzwagi to reduce cash outflows, and boost the balance sheet.