Wheaton Precious Metals Backs Hemlo Mine Acquisition with $400M Gold Stream Financing

Wheaton backs Hemlo with up to $400 million gold stream – here’s what’s in the RNS

Wheaton Precious Metals has committed to finance Carcetti Capital’s proposed purchase of the long‑running Hemlo Mine from Barrick. The centrepiece is a gold streaming agreement of up to $400 million, alongside Wheaton taking part in Carcetti’s equity raise. If the deal completes, Carcetti will rebrand as Hemlo Mining Corp (HMC). All figures are in US dollars.

The transaction is not yet binding. It is subject to definitive agreements and customary conditions, with closing targeted for the fourth quarter of 2025.

Financing breakdown for the Hemlo acquisition

• Up to $400 million Wheaton gold stream.
• Concurrent equity financing with estimated proceeds of approximately $415 million, in which Wheaton will participate up to the lesser of $50 million or 20% of the raise.
• $200 million in bank debt (the Acquisition Facility).

One nuance matters: if the equity financing exceeds $300 million (excluding Wheaton’s participation), HMC may ask to reduce the stream deposit by the excess, up to $100 million. In that case, the stream percentage falls proportionately and Wheaton’s equity cheque is capped at the lesser of $30 million and 20% of the raise. In short, a larger equity raise could mean Wheaton pays less up front and also receives a smaller slice of Hemlo’s gold.

What is a gold stream, in plain English?

A gold stream is a financing deal where Wheaton pays an upfront deposit today and, in return, gets the right to buy a fixed percentage of a mine’s future “payable gold” (the portion credited for sale) at a discounted price. Here, Wheaton will pay 20% of the prevailing spot price for each ounce delivered. The model gives Wheaton commodity exposure and long mine-life cash flows without operating the mine, while giving HMC lower-cost capital than traditional debt or equity.

Key terms of the Hemlo Gold Stream

• Streamed metal: 13.5% of payable gold until 181,000 ounces have been delivered (First Dropdown Threshold), then 9.0% until a further 157,330 ounces, then 6.0% for life of mine.
• Schedule protection: both thresholds adjust if deliveries are delayed. From 2033, if deliveries are 10 koz or more behind the agreed schedule, the stream percentage steps up by 5% until deliveries catch up.
• Interlake carve‑out: for gold from certain Interlake deposit claims, the applicable stream percentage is halved.
• Payability: calculated using a fixed payable factor of 99.95%.
• Ongoing payments: Wheaton pays 20% of the gold spot price on each ounce delivered.

Production profile and reserve impact

Wheaton expects attributable production from the stream to average approximately 20 koz of gold per year over the first 10 full years, and over 17 koz per year across the life of mine. Hemlo is currently forecast to have a 14‑year mine life with “significant brownfield exploration potential” near existing underground infrastructure.

On reserves and resources attributable to Wheaton, adding Hemlo increases Proven and Probable gold reserves by 0.25 Moz, Measured and Indicated resources by 0.08 Moz, and Inferred resources by 0.04 Moz.

Why this matters for Wheaton shareholders

Strategically, Hemlo ticks several Wheaton boxes: a politically stable Canadian jurisdiction, a long operating history and underground infrastructure already in place. The 20% of spot pricing keeps per‑ounce margins robust, particularly in a strong gold market. The stream also comes with first‑priority security interests (shared with the bank lenders) and corporate guarantees from HMC, plus a right of first refusal over future precious metal monetisations. That combination tightens downside protection and preserves future optionality.

The delivery “catch‑up” mechanic from 2033 is a quiet positive; if HMC falls meaningfully behind schedule, Wheaton’s stream percentage temporarily increases, helping offset timing slippage. The Interlake reduction is the main offset – stream percentages are halved on certain Interlake claims – but that is clearly laid out up front.

Implications for Carcetti/Hemlo Mining Corp

For HMC, Wheaton’s backing adds credibility and reduces execution risk on a complex carve‑out from Barrick. The package blends equity, bank debt of $200 million, and a stream that preserves operational control while limiting balance sheet strain. The trade‑off is straightforward: HMC gives up a share of future gold at a discount to spot in order to secure the upfront deposit and de‑risk the acquisition plan.

The company intends to drive further improvements at Hemlo. Management and Wheaton both point to the asset’s geological upside, which – if realised – would benefit HMC first, and Wheaton through a longer stream tail.

Balance sheet capacity: can Wheaton afford it?

As at 30 June 2025, Wheaton held approximately $1.0 billion in cash. Add a $2 billion revolving credit facility and ongoing operating cash flows, and the company looks well placed to fund up to $400 million for Hemlo while keeping firepower for other opportunities and commitments.

About the Hemlo Mine

Hemlo has produced approximately 25 million ounces of gold and has been in continuous operation for more than 30 years. It sits east of Marathon, Ontario, close to the Trans‑Canada Highway. The operation moved from open pit to underground in October 2020. On closing, Carcetti will rename itself Hemlo Mining Corp and will be led by a team with deep familiarity with the asset.

Key numbers at a glance

Upfront stream deposit	Up to $400 million
Equity raise	\~$415 million (Wheaton up to the lesser of $50 million or 20%)
Bank debt	$200 million
Stream percentages	13.5% to 181,000 oz; then 9.0% to an additional 157,330 oz; then 6.0% life of mine
Ongoing payment	20% of spot price per ounce
Attributable production	\~20 koz/year (first 10 full years); >17 koz/year life of mine
Mine life	14 years (forecast)
Reserve/resource uplift	+0.25 Moz P&P; +0.08 Moz M&I; +0.04 Moz Inferred
Closing	Expected Q4 2025

Risks and what to watch next

• Deal certainty: everything hinges on definitive agreements and closing the Barrick acquisition – not yet done.
• Deposit adjustment: a bigger‑than‑planned equity raise could trim the deposit by up to $100 million and proportionally reduce the stream percentage.
• Delivery timing: if Hemlo lags its schedule, ounces shift right. The 2033 catch‑up feature helps, but timing still matters for near‑term cash flow.
• Interlake exception: stream percentages are halved on certain Interlake claims – worth remembering when modelling ounce attribution.
• Gold price sensitivity: Wheaton pays 20% of spot, so margins expand or compress with the gold price.
• ESG and governance: HMC is expected to meet the Global Industry Standard on Tailings Management and the Towards Sustainable Mining Standard – a positive, but ongoing compliance will be key.

My take: a tidy, disciplined addition with sensible protections

This looks like classic Wheaton: a sizeable, disciplined stream on a Canadian stalwart, with security, a ROFR and clear delivery mechanics. The per‑annum ounces are meaningful but not transformative, which is fine given the risk profile. The optional deposit reduction clause and the Interlake carve‑out are the main caveats, yet they’re balanced by the schedule catch‑up feature and robust ongoing margins.

Bottom line: if the acquisition closes as planned in Q4 2025, Hemlo should add durable, high‑quality gold exposure to Wheaton’s portfolio, funded from a very strong balance sheet. I’ll be watching for the definitive agreements, final stream percentage after any equity adjustments, and any updated mine plan that speaks to the brownfield upside.