IAMGOLD sells Diavik royalty stream to Sandstorm Gold for US$56.8 million

IAMGOLD Corporation ("IAMGOLD" or "the Company") announced Monday it has completed an agreement with Sandstorm Gold Ltd. to sell the Company's gross proceeds royalty over property in Lac de Gras in the Northwest Territories, Canada, including property constituting the Diavik Diamond Mine (the "Diavik Diamond Royalty"). The Diavik Diamond Mine is owned, under an unincorporated joint venture structure, 60% byDiavik Diamond Mines Inc. ("DDMI"), a subsidiary of Rio Tinto plc, and 40% by Dominion Diamond Diavik Limited Partnership, a subsidiary of Dominion Diamond Corporation and is operated by DDMI. The Diavik Diamond Royalty is being sold for total proceeds of $56.8 million, comprised of $52.5 million cash on closing and three million five-year warrants exercisable after initial production from the Diavik Diamond Mine's A21 pipe at an exercise price of $4.50, valued at $4.3 million based on the Company's internal valuation methodology.

"Given the quality of the Diavik Diamond Royalty we received very strong interest in the sale, which resulted in a satisfactory outcome for both parties," stated Steve Letwin, President and CEO of IAMGOLD.  "With the Sandstorm warrants, we are also positioned to benefit from the addition of this asset to their portfolio.  As a result of this sale, the previously completed sale of Niobec and ongoing initiatives to conserve cash, IAMGOLD is left in a very strong financial position with the ability to invest further in its existing portfolio of assets and to consider acquisition opportunities that will contribute to positive cash flow.   Following completion of this transaction, all of IAMGOLD'smines and projects are focused on its core business of producing gold."

Sandstorm said the deal with IAMGOLD will add US$7 million to US$8 million per year in cash flow to its portfolio.