The MALARTIC gold mine, Quebec. Photo: Osisko

The MALARTIC gold mine, Quebec. Photo: Osisko

Osisko's Roosen Pushing Fingers into Several Pies

Issue 95, September 2014

Osisko Gold Royalties has struck its third equity deal in three months, buying shares in Toronto-listed explorer Falco Resources, lifting its total shareholding to 13 per cent. 

Shares in Falco, the dominant landholder on the former Rouyn Noranda copper-gold camp in northwest Quebec, rose over 8 per cent on the news. The company is undergoing a board restructure and has not issued a statement regarding the transaction, but spokesman Dean Linden told Global Mining Observer that Falco took the move as a big endorsement by Osisko’s board, led by chief executive Sean Roosen.

“He’s one of the big stars in the mining world,” Linden said. “The job that they did with Malartic is remarkable. A lot of people didn’t believe it could be done, but they’ve built it into a marvelous asset.”

Roosen’s team at Osisko led a revival of Quebec’s then dormant Malartic gold camp, building it into a 16m ounce gold mine, bought out this year for C$3.9bn ($3.6bn). Management was spun-off into Osisko Gold Royalties, pumped with cash, shares and a 5 per cent royalty over the mine.

The new vehicle has since bought shares in explorer Nighthawk Gold and Quebec-based NioGold Mining, bringing its stake in the company to 19.5 per cent. NioGold has also sold royalty rights to Osisko, appointed two Osisko directors to its five man board and agreed to move its office to Montreal, Osisko’s own base. In total, the deals have cost Osisko C$6.7m.

The company has been widely touted by analysts as an “exciting new royalty play”, though its recent equity forays suggest it is edging towards project development, finding it easier to buy equity in juniors than strike royalties over new mines.

Like London-listed Anglo Pacific, Roosen has said Osisko is in discussions with institutional investors over syndicating royalty deals, potentially lifting its firepower substantially above its C$157m cash position. Shares spiked to a high of C$16.48 on listing in June, but have since dropped 10 per cent to C$14.90. 

“He’s one of the big stars in the mining world.”

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