Business
The Metals Royalty Company Enters Into Definitive Agreement to Acquire Royalty Interest on Mesabi Metallics Iron Ore Project in Minnesota
$132.5 Million Acquisition of an Index-Priced Production Royalty on One of the United States' Only Large-Scale Merchant DR-Grade Iron Ore Projects Transaction
About this update from Tmc The Metals Company Inc.
[{"type":"text","content":" $132.5 Million Acquisition of an Index-Priced Production Royalty on One of the United States' Only Large-Scale Merchant DR-Grade Iron Ore Projects Transaction Highlights: $132.5 million cornerstone royalty acquisition - TMCR has entered into a definitive agreement to acquire a 1.0% Index-Priced Gross Overriding Production Royalty with a Revenue Floor (on production up to 8.5 Mtpa) on the Mesabi Metallics iron ore project in Minnesota, anticipated to be a fully integrated, large-scale source of high‑quality DR‑grade pellets critical to the global green steel transition and the advancement of American domestic steel production. Financing funds acquisition - Transaction financed via allocated $75 million PIPE, including $15 million of participation from founders and insiders, priced at $13.00 per share; and up to a $50 million acquisition credit facility term sheet for a senior secured term-loan credit facility. Near-term, high-quality royalty cash flow - First production targeted for H2 2026 with ramp up to full capacity expected in 2027, implying anticipated initial annual royalty cash flow potential of up to ~$13M+ with further potential upside tied to commodity prices and throughput expansion. Tier-1 asset in a Tier-1 jurisdiction - The Mesabi Project spans more than 16,000 acres in Nashwauk, Minnesota and is expected to be one of the lowest‑cost DR pellet producers in North America, supported by a 23+ year mine life. Over $2.5 billion is planned to be invested by completion date in core infrastructure at the project, which is approximately 93% complete. The project is strategically positioned near key end markets and integrated into well‑established North American transportation networks. Essar Group sponsorship with proven execution - Backed by Essar Group, a global industrial platform with >50 years of experience, ~$15B of revenue, and a track record of building and operating world-class industrial projects including pellet and steel assets - providing TMCR with the sponsor quality and execution certainty that underpins a royalty investment of this nature. Project fully financed based on current expenditure budget to first cash flow - ~$2bn equity invested by Essar Group with additional support by a $520M senior secured facility from Breakwall Capital and a $150M liquidity line from Macquarie Group materially de-risking ...