Bullion miner Equinox Gold has sold its Pilar gold mine to a new Brazil-focused Canadian company as part of a portfolio optimisation process to focus on larger assets, CEO Christian Milau announced on Monday.
Equinox will sell the mine to Pilar Gold, which plans to seek a public listing later this year, for $38-million in cash, a 9.9% equity interest in the buyer and a 1% net smelter returns royalty on production from the mine.
“With existing production and growth potential, the Pilar gold mine is an excellent foundation mine for an emerging gold company. We look forward to participating in the success of Pilar Gold as a supportive shareholder as they launch a new Brazil-focused gold producer,” said Milau.
Equinox would update its production guidance next month, to reflect the loss of 35 000 oz/y from the Pilar sale and the addition of the producing Mercedes mine, in Mexico, to its portfolio following the completion of Premier Gold Mines.
The company recently announced that it had acquired an additional 10% in the Greenstone project, in Canada, for $51-million. It acquired its initial 50% shareholding in the project through the acquisition of Premier.