There are three big royalty companies out there. RGLD – Royal Gold, FNV.TO – Franco Nevada and SLW – Silver Wheaton. If you are not familiar with the royalty concept check the Royalty Companies Overview article I published a while back.
Franco-Nevada raised money by selling 10 million units at $32.20 each. Each unit consists of a common share and half a warrant, and a full warrant can be used to purchase a share for $75 over the next eight years. The company currently has more than 300 royalty assets in gold, PGM , oil and gas properties and operations with gold revenues making up 65% of Franco’s royalty revenues.
The offering is scheduled to close on or about June 16th, 2009. I believe this is a great opportunity to increase exposure to royalty companies. My game plan is exactly the same as with RGLD – Royal Gold. I will try to build a position as we near the closing date. The financing provides a price floor and the amount of money Franco-Nevada will be able to spend offers a tremendous and continued growth opportunity for the company.
I am tracking the stock on my public list. This FNV.TO – Franco-Nevada chart updates automatically and you can access it whenever it suits you.
Have a great evening!
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