Junior Equities Portfolio
Altius has built a portfolio of directly and indirectly held junior resource investments that have been generated from founding stakes and earn-in option related payments through its joint venture strategy to advance projects as well as selective investing in other juniors employing a project generation and joint venture business model. As of September 30, 2019, the net market value of Altius’s portfolio of public junior company equities was approximately $52.5 million, after generating net monetizations of $16.2 million year to date.
Altius' PG strategy is simple but requires a longer cyclically based strategy than most of our industry peers. We organically assemble and generate prospective geological real estate around the globe during periods of bear sentiment when capital for most is sparse, hence competition is light. To put this into perspective from 2012 to 2016 Altius assembled nearly 2 million of hectares of land in 9 different jurisdictions covering prospective terrains for copper, nickel, zinc, iron ore, coal, gold and even diamonds. When the market finally turned in 2017 Altius was poised to sell its portfolio of lands to juniors in return for equity stakes and underlying royalty interests.
In the past couple years Altius has effectively sold 57 global exploration projects as part of 17 agreements with various industry partners. This has resulted in the conversion of most of the mineral lands that it assembled during the preceding cyclical downturn into new royalties and the portfolio of 20+ junior equities.
Project Generation Equity Portfolio
as of September 30, 2019
|Symbol||Company||ALS >10%||ALS >20%||Royalty|
|IRON: T||ALDERON IRON ORE||52,526,206||Y|
|CIA:T||CHAMPION IRON LTD||N|
|REN:V||RENAISSANCE GOLD INC||6,800,000||Y|
|SIC:V||SOKOMAN IRON CORP||Y|
1 Aethon holdings in table reflect only direct holdings through open market purchases.
Altius also holds 49% of 11, 200,000 shares through its Mining Equity Joint Venture interest.
Our model has worked well by allowing exposure to multiple opportunities while minimizing negative impacts to the capital structure of the company all the while creating royalties at a zero to often negative cost for future benefit to all shareholders. Earnings generated from the prospect generation business are either re-circulated into the exploration business or used to acquire third party royalties to augment the internally generated royalties held by the business.