Sep 19, 2012 / 7:31 am
B2Gold Corp. (TSX:BTO) expects to make a "a big jump forward" in its expansion plans by acquiring CGA Mining Ltd. (TSX:CGA) and its mine in the Philippines through a friendly all-stock deal they value at $1.1 billion.
The combined company will have operating mines in Nicaragua and the Philippines and other properties at the development or exploration stage in Latin America and Africa, if the proposed deal gets the required approvals,
"For B2Gold, the combination with CGA represents the opportunity to dramatically increase our gold production from 160,000 ounces a year â€” which is growing from our development projects â€” to 360,000 ounces a year with the completion of this transaction," B2Gold chief executive Clive Johnson said.
Johnson told analysts in a conference call that the Vancouver-based company expects deposits at or near B2Gold's two mines in Nicaragua will begin production in the coming years. In addition, a new mine planned for Namibia is expected to produce 100,000 ounces a year when it's built.
"So B2Gold is a rapidly growing company and we've taken a big jump forward here in adding what we consider to be, subject to closing this deal, an excellent project, which has great exploration upside and, ultimately, potential to expand production from where it is today."
Shareholders of B2Gold, which had a market value of nearly $1.7 billion before the announcement, will own about 62 per cent of the combined company, which is projected to produce 700,000 ounces of gold by 2016.
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