Equinox Gold to acquire Canadian gold producer Leagold Mining

Equinox Gold acquisition of Leagold Mining : Canadian mining company Equinox Gold has signed a deal of about CAD 769.3 million ($ 578.38 million) to acquire Leagold Mining, as per the latest mining acquisition news.

Also based in Canada, Leagold Mining is a mid-tier gold producer focused on Latin America. The Canadian gold mining company owns four operating gold mines located in Mexico and Brazil.

Leagold Mining also owns a near-term gold mine restart project in Brazil along with an expansion project at the Los Filos mine complex located in Mexico.

Equinox Gold expects the merger to create one of the top gold producing companies in the world operating completely in the Americas with a diversified operating platform made up of six operating gold mines in the US, Mexico and Brazil.

The enlarged gold mining company will continue as Equinox Gold with headquarters in Vancouver. The company’s 2020 gold production will be 700,000 ounces, which will increase to a million ounces annualized production during 2021 and later, based on analyst consensus estimates.

Christian Milau – CEO of Equinox Gold, commenting on Equinox Gold acquisition of Leagold Mining, said: “Combining these companies creates a leading growth focused gold company and accelerates our shared vision of becoming a million-ounce gold producer.

“As both a shareholder and executive, I believe the scale and diversification of the combined company will create significant value for all shareholders, demonstrating the value of industry consolidation that investors have been asking for.”

Equinox Gold acquisition of Leagold Mining. Photo courtesy of István Mihály from Pixabay.

As per the terms of Equinox Gold acquisition of Leagold Mining, shareholders of the latter will be issued 0.331 of a share of the former for each of its shares.

The transaction values each of the shares of Leagold Mining at CAD 2.70. Upon completion of the merger, current Equinox Gold and Leagold Mining shareholders will own nearly 55% and 45% of the merged gold mining company, respectively.

Commenting on Equinox Gold acquisition of Leagold Mining, Neil Woodyer – CEO of Leagold Mining, said: “This transaction is a rare opportunity to combine companies with common business plans and growth strategies, complementary assets, and management teams that can be integrated effectively, with Equinox Gold as the go-forward entity to maintain the TSX and NYSE American listings.

“The transaction has received exceptionally strong support from shareholders, from Mubadala and from a syndicate of leading commercial lenders which collectively will enable us to fully fund the new company’s growth plans.”

Equinox Gold acquisition of Leagold Mining is expected to be wrapped up in Q1 2020, subject to shareholders’ approvals and regulatory approvals.