Equinox Gold to buy Premier Gold in all-stock deal valued at C$611 million
(Kitco News) - Equinox Gold is solidifying its role as one of the top gold miners in the Americas, announcing a friendly acquisition of Premier Gold Mines Limited Wednesday.
The all-stock deal is valued at C$611.7 million. According to some reports, the agreement is worth about C$2.57 per share, representing a 2% premium to Premier's Tuesday close.
Equinox said that it would undertake a C$75 million equity financing fully underwritten by its Chairman, Ross Beaty, to help fund the deal.
Equinox said after the deal is completed, it will retain Premier Gold's interest in the world-class Hardrock Project in Ontario, the Mercedes Mine in Mexico, and the Hasaga and Rahill-Bonanza properties in Red Lake, Ontario.
"Hardrock bolsters Equinox Gold's robust pipeline of growth projects and will add approximately 200,000 attributable ounces of long-term, low-cost annual gold production, when in operations, in Ontario, Canada, one of the world's top mining jurisdictions," the company said in its press release.
At the same time, Premier Gold said that it will spin-out to its shareholders shares of a newly created US-focused gold production and development company to be called i-80 Gold Corp.
The Spinco will own the South-Arturo and McCoy-Cove properties and will complete Premier's previously announced acquisition of the Getchell Project, all in Nevada, Premier said.
"On closing of the Transaction, existing Equinox Gold and Premier shareholders will own approximately 84% and 16% of Equinox Gold, and Equinox Gold and existing shareholders of Premier will own 30% and 70% of i-80 Gold, respectively, on an issued share basis," the company said in a press release.
In March, Equinox Gold and Leagold Mining Corporation completed their merger to create one of the world's top gold producing companies operating entirely in the Americas.