Silver Wheaton Corp. (TSX: SLW) is the world’s biggest precious metals financing firm, helping miners fund projects while benefiting from discounts on any silver or gold produced subsequently.
The company recently stated that major miners have now joined what used to be a traditionally smaller-scale business model.
“What we’ve seen over the last four months is that even the large companies are all of a sudden receptive” to Silver Wheaton’s funding model, known as streaming, [CEO Randy] Smallwood said yesterday in an interview at Bloomberg’s Toronto office. “Doors that we’ve been knocking on for a long time, they are all of a sudden knocking on our door.” He declined to name any projects or companies.
Naturally, this unexpected upgrade in the scale of operations can definitely benefit Silver Wheaton by way of larger transactions, lower risk, and so on.
The company is presently valued at around $12.3 billion, rising 22 percent over 2012. On Friday morning, shares were up 2.22% to C$35.48.
Thus far, one of Silver Wheaton’s biggest successes was a deal to buy silver from four of Barrick Gold Corp.’s (TSX: ABX) mines, struck in September 2009. That deal also included 25 percent of silver produced from the Pascua-Lama project. In return, Silver Wheaton paid Barrick $625 million spread over the next three years while receiving silver at a maximum of $3.90/oz (inflation-adjusted).
Silver, of course, has been enjoying a good time recently; Bloomberg analysts expect it to average around $34.16/oz through 2013.