Equinox Gold, the owner of the Greenstone mine, is making a great leap forward with its proposed acquisition of Calibre Mining.
In what’s being presented as a merger of equals, the Vancouver miner will acquire all of the issued and outstanding common shares of Calibre Mining.
The two companies announced this week that they have entered into a definitive arrangement agreement.
The $2.6-billion, all-stock transaction is expected to close in the second quarter once shareholders from both companies vote on the deal.
The combined companies will continue under the Equinox name.
In creating a “Canadian gold powerhouse,” Equinox chair Ross Beaty said this move elevates them from mid-tier status to becoming a major gold producer for decades to come.
The cornerstone assets of this new company will be Equinox’s Greenstone mine, near Geraldton in northwestern Ontario, and Calibre’s Valentine mine project, nearing construction completion in central Newfoundland and Labrador.
By joining forces with Calibre, Equinox will leapfrog from being Canada’s fifth largest gold producer to second, behind Agnico Eagle.
In explaining the logic of the deal, Beaty said in a Feb. 24 conference call that this was a rare opportunity to combine two great gold deposits, early in their production life, under a single ownership structure to become one of Canada’s largest gold producers.
Since the formation of Equinox in 2018, Beaty said the mission has always been “to get big quickly” through merger and acquisition. Building out scale is essential in the capital markets, he said.
“Size matters.”
With gold at record highs today, Beaty sees no reason for this bullish gold environment to stop its appreciating trend in 2025. This transaction, he said, brings value to investors, will increase their gold production, will boost reserves and resources, and will generate “astonishing cash flow.”
Greenstone achieved commercial production last November. The open-pit project is ramping up to produce between 300,000 and 350,000 ounces by year’s end.
Valentine is close to construction completion with the first gold pour expected mid-year.
When operating at full capacity, these two mines are expected to collectively produce 590,000 ounces of gold annually.
Down the road, combined with production from other mines in the U.S., Mexico, Nicaragua and Brazil, Equinox said it's on a path to achieve more than 1.2 million ounces a year.
In 2024, Equinox produced a total of 622,000 ounces. The new portfolio will more than double production by 125 per cent to 1,385,000 ounces by 2026.
