12 December 2022

Duke Royalty Limited

("Duke Royalty", "Duke" or the "Company")

Refinance and Upsize of Credit Facility to £100 million on
Improved Terms with Fairfax Financial

Duke Royalty, a provider of alternative capital solutions to a diversified range of profitable and long-established businesses in Europe and North America, is pleased to announce that it has entered into a new £100 million credit facility agreement (the "New Credit Facility") with Fairfax Financial Holdings Limited and certain of its subsidiaries ("Fairfax").

The material terms of the New Credit Facility are as follows:

·         Term facility of up to £100 million to replace Duke's existing £55 million term and revolving facilities

·       Five-year term, expiring in January 2028 with a bullet repayment on expiry and no amortisation payments during the five-year term

·         Interest rate equal to SONIA plus 5.00% per annum, which represents an improvement of 225bps on Duke's existing rate of SONIA plus 7.25%

·         As part of the deal, Duke will issue 41,615,134 warrants to Fairfax with a five-year maturity and strike price of 45 pence reflecting the strategic nature of the deal

·       Initial drawdown of the New Credit Facility expected to occur in mid/late January 2023 coinciding with the expiry of the non-call period enshrined in Duke's existing credit facilities

The New Credit Facility will provide Duke with a significant amount of additional liquidity and will push out the Company's requirement for additional equity capital. Furthermore, the New Credit Facility comes at a lower cost to the Company's existing credit facility thereby having an immediate and material impact on the free cash flow of the Company.

Neil Johnson, CEO of Duke Royalty, said:

"I am delighted to announce this upsized credit facility with Fairfax on improved terms for Duke shareholders. Fairfax is an internationally recognised and well respected company. Both Duke and Fairfax have similar philosophies of investing in a supportive way over the long term and I believe that this is the start of a long standing and mutually beneficial relationship.  

"The upsizing of the New Credit Facility will allow Duke to accelerate its growth and deployment schedule without any near-term equity dilution. More strategically, Fairfax and Duke believe our partnership can benefit more businesses looking for long-term, flexible capital solutions by increasing Duke's capital base and diversification, as well as benefit Duke's shareholders through higher free cash flow per share."

Prem Watsa, Chairman and CEO of Fairfax, said:

"We are impressed with the degree to which Duke's investing philosophy aligns with our own - focusing on lending to established, profitable, cash-generating, well-managed companies, with incentivised management teams. We are delighted to be partnering with Duke and believe that there is a large group of companies that can benefit from Duke's long-term flexible support."

About Fairfax Financial Holdings Limited

***ENDS***

For further information, please visit www.dukeroyalty.com or contact:

About Duke Royalty

Duke Royalty Limited provides alternative capital solutions to a diversified range of profitable and long-established businesses in Europe and abroad. Duke Royalty's experienced team provide financing solutions to private companies that are in need of capital but whose owners wish to maintain equity control of their business. Duke Royalty's royalty investments are intended to provide robust, stable, long term returns to its shareholders. Duke Royalty is listed on the AIM market under the ticker DUKE and is headquartered in Guernsey.