Vancouver-headquartered B2Gold on Monday announced that it would acquire Sabina Gold & Silver in a C$1.1-billion transaction, which would diversify its assets with access to the Back River gold district, in Nunavut, Canada.

The Back River gold district consists of five mineral claims blocks along an 80 km belt. The most advanced in the district, Goose, is full permitted and construction ready.

Under the terms of the transaction, B2Gold would issue 0.3867 of a common share for each Sabina common share held, representing consideration of C$1.87 a Sabina share on a fully-diluted basis. The consideration implies a premium of 45% to the 20-day volume weighted average prices of each of B2Gold and Sabina on the TSX as of February 10.

Existing B2Gold shareholders and former Sabina shareholders will own about 83% and 17%, respectively, of the outstanding B2Gold shares.

“The acquisition of Sabina represents an exciting opportunity to develop the significant gold resource endowment at the Back River gold district into a large, long life mining complex,” said B2Gold president and CEO Clive Johnson.

“The Back River gold district has multiple high-potential mineralised zones which remain open, and we are confident that the district has strong untapped upside with numerous avenues for resource growth.”

A March 2021 updated feasibility study on the Goose project outlined a 15-year life-of-mine, producing an average of 223 000 oz/y of gold from 3.6-million ounces of mineral reserves averaging 5.97 g/t.

The Goose project has been significantly derisked with 97% of procurement complete, prestripping having begun at the Echo pit, and 100% of plant site civil works completed.

“The execution of the Goose project by Sabina did not come without risk to Sabina as a single asset, junior development company with capital constraints. With a two-year construction period until first gold production, we believe that additional value can be unlocked by participating as shareholders of a major gold producer with the northern experience and financial resources to optimise the Goose project and this prolific belt.

“Shareholders will also benefit from exposure to B2Gold’s continued growth and healthy dividends,” commented Sabina president and CEO Bruce McLeod.

The B2Gold board of directors has unanimously approved the transaction and so did the Sabina board. Sabina directors have recommended that its shareholders vote in favour of the transaction.

Following the transaction, B2Gold will have production and development assets spanning four continents and located in both established mining jurisdictions and high growth emerging economies, serving to mitigate collective operational and geopolitical risk. B2Gold currently has assets in Mali, Namibia and the Philippines.