Royalty firm Triple Flag to buy peer Maverix Metals in $600 million deal

(Reuters) -Triple Flag Precious Metals Corp said on Thursday it would buy peer Maverix Metals Inc in a royalty sector deal pegged as the biggest in North America.

The company said the deal, valued at $606 million, would cement its position as the fourth-largest senior streaming and royalty company globally. These firms provide financing for exploration and development to precious metals producers in return for a cut in any future output.

Elliott Investment Management LP, which owns 83% of Triple Flag, as well as key Maverix shareholders Newmont Corp, Pan American Silver Corp and Kinross Gold Corp are all in favor of the deal.

Top gold miner Newmont and Pan American along with the officers and directors of Maverix own about 57% of the company's stock.

Triple Flag said it expects the deal to add to its net asset value as well as cash flow per share.

Maverix stockholders can choose to receive either $3.92 in cash, or 0.360 of a Triple Flag share for each share held, implying a premium of 10% to Maverix's last close.

U.S.-listed shares of Maverix rose 7.6% in premarket trade, while Triple Flag stock was flat.

The transaction is expected to be completed in January 2023, after which Triple Flag and Maverix shareholders would own about 77% and 23%, respectively, of the combined company.

The agreement allows Triple Flag to match superior proposals and includes a $24 million termination fee.

The company will continue as Triple Flag Precious Metals Corp, headquartered in Toronto, with Geoff Burns, founder and chair of Maverix, and another nominee of the firm expected to join the Triple Flag board.

(Reporting by Ankit Kumar;Editing by Vinay Dwivedi)