Equinox Gold has secured full ownership of the Greenstone Gold Mine in Ontario by reaching a $995m (C$1.36bn) deal to acquire the remaining 40% stake in the mine from Orion Mine Finance Management.
Under the binding share purchase agreement (SPA), Equinox will issue 42 million common shares and make cash payments of $705m on closing and $40m by 31 December 2024.
This acquisition will be financed through a combination of a new $500m three-year term loan and a bought deal equity financing (offering) of around $260m.
The term loan is being provided by a syndicate of banks including the Bank of Nova Scotia, Bank of Montreal, ING Capital and National Bank of Canada.
Equinox also signed an agreement with underwriters led by BMO Capital Markets, National Bank Financial and Scotiabank for the equity financing.
The company plans to use the offering’s proceeds to fund the cash consideration of the SPA as well as for general working capital and corporate requirements such as paying down certain debts.
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The offering’s closure is anticipated around 26 April 2024, subject to approvals from the Toronto Stock Exchange and the NYSE American.
Completion of the deal is scheduled in the second quarter of 2024, contingent on regulatory clearances.
Greenstone Gold Mine, located near Thunder Bay, Ontario, is considered one of Canada’s largest and highest-grade open-pit gold mines.
The project includes plans for an open-pit mine, processing plant and related facilities, built on the site of the historic Hardrock, MacLeod-Cockshutt and Mosher mines, which produced more than two million ounces of gold until 1970.
Equinox Gold president and CEO Greg Smith said: “Opportunities to own gold mines like Greenstone are incredibly rare in our industry, and the Greenstone Mine will now be the foundation for long-term value creation in our company.
“I also welcome Orion as a shareholder of Equinox Gold and thank them for being a great partner over the last few years, as together with the Greenstone team we have executed a very successful mine build.
“Greenstone is well into hot commissioning, with first gold in sight. Now, as full owners, we remain focused on advancing Greenstone to commercial production and look forward to surfacing its full potential.”
