04:58 PM EDT, 04/23/2024 (MT Newswires) -- Equinox Gold ( EQX ) was down 5.3% in after-hours New York trading after the company on Tuesday said it is agreed to acquire the 40% stake in the Greenstone mine in Ontario it does not already own from funds controlled by Orion Mine Finance Management for US$995 million in cash and shares, and will pay for the transaction with a US$260-million bought-deal share offering and a US$500 million loan.

The company said consolidating its ownership of the mine, which is expected to begin production in the second half of 2024, raises its gold output by 160,000 ounces per year, while improving EBITDA and cash flow. Greenstone is expected to produce 400,000 ounces annually over its first five years of production.

"When we acquired our 60% interest in Greenstone in 2021, our goal was to ultimately own the whole mine. Consolidating 100% of Greenstone into Equinox Gold ( EQX ) delivers our shareholders full exposure to a mine of outstanding scale and quality, in one of the best mining jurisdictions in the world, while meaningfully growing our expected production, cash flow and reserves," board chair Ross Beaty said in a release.

Equinox Gold ( EQX ) will fund the cash consideration with net proceeds from both a US$500 million three-year term loan and a bought deal equity financing of common shares of Equinox Gold ( EQX ) for approximately US$260 million. The bought deal sees the company sell an underwriting syndicate 49-million shares priced at US$5.30 each.

Equinox will pay Orion 42-million shares, valued a US$250 million, US$705 million in cash on close and a further US$40 million by year end.

Equinox shares were last seen down US$0.30 to US$5.42 after hours. They closed up C$0.06 to C$7.82 on the Toronto Stock Exchange.

Price: 7.82, Change: +0.06, Percent Change: +0.77