06:42 AM EDT, 10/03/2024 (MT Newswires) -- Equinox Gold ( EQX ) on Thursday said it has issued around 24.8 million common shares to Ninety Fourth Investment Company, an affiliate of MDC Industry Holding Company, on conversion of a US$130 million convertible note held by MDC.

Additionally, Equinox Gold ( EQX ) and Ninety Fourth agreed that BMO Capital Markets will purchase on a bought deal basis the 24.8 million common shares from Ninety Fourth at US$5.65 per share for total gross proceeds of US$140 million.

Equinox Gold ( EQX ) will not receive any proceeds from the share sale, with all proceeds going directly to Ninety Fourth.

"Conversion of the US$130 million convertible note reduces our current debt and meaningfully enhances our liquidity," said Greg Smith, president and CEO of Equinox Gold ( EQX ).

MDC's US$130 million note was issued in 2019 with a US$5.25 per share conversion price. Upon the offering's completion, MDC will continue to hold a second US$130 million convertible note of Equinox Gold ( EQX ) with a Sept. 10, 2025, maturity date and a US$6.50 per share conversion price, representing 4.22% of the issued and outstanding common shares on an as-converted basis.

The offering is scheduled to close Oct. 9, subject to customary closing conditions.

Equinox Gold's ( EQX ) share price at last look was down 4.2% to US$5.90 in U.S. pre-market trading on Thursday.