Equinox Gold to Acquire Remaining 40% Interest in Greenstone Gold Mine for $995 Million

Equinox Gold Corp. has entered into a binding agreement to acquire Orion Mine Finance's 40% interest in the Greenstone Gold Mine in Ontario, Canada for $995 million. The transaction, which is expected to close on or about April 26, 2024, will increase Equinox Gold's ownership of the mine to 100%.

The $995 million purchase price will be comprised of $250 million in common shares, $705 million in cash payable at closing, and $40 million in cash payable at the end of 2024. Equinox will finance the cash portion of the acquisition through a new $500 million three-year term loan and a $260 million bought deal equity financing.

Why this matters: The acquisition consolidates Equinox Gold's ownership of the large, high-grade Greenstone Mine, which is expected to significantly boost the company's gold production and cash flow. The mine is positioned to become one of the world's lowest-cost open-pit gold mines in a top mining jurisdiction.

Once the acquisition is complete, Greenstone will become Equinox's largest mine, increasing the company's annual gold production by 160,000 ounces to an expected average of 400,000 ounces per year over the first five years. Equinox expects Greenstone to be one of the world's lowest-cost open-pit gold mines, with cash costs in the industry's lower quartile.

Equinox Gold's Chairman, Ross Beaty, stated, "The consolidation of 100% ownership in Greenstone will deliver full exposure to a world-class gold mine in a top mining jurisdiction." The company's President and CEO, Greg Smith, welcomed Orion as a shareholder and expressed enthusiasm about advancing the Greenstone Mine to commercial production.

Orion, which has been a partner in the Greenstone project since 2016, also expressed its support for the transaction. Orion's Managing Partner, Istvan Zollei, praised the partnership with Equinox Gold and looked forward to the mine's continued success.

The acquisition is expected to be significantly accretive to Equinox Gold's near-term EBITDA and cash flow per share. The transaction is subject to customary closing conditions and regulatory approvals. Equinox Gold and Orion both expressed their commitment to advancing the Greenstone Mine to commercial production and realizing the full potential of this high-quality asset.

Key Takeaways

• Equinox Gold acquires Orion's 40% stake in Greenstone Gold Mine for $995M
• Acquisition increases Equinox's ownership to 100% and boosts gold production
• Greenstone to become Equinox's largest mine, producing 400k oz/yr at low costs
• Acquisition financed through $500M term loan and $260M equity financing
• Transaction expected to be accretive to Equinox's EBITDA and cash flow