Equinox sells Brazil assets to Chinese group for $1bn
Gold miner Equinox Gold has agreed to sell its Brazil operations to a subsidiary of China’s CMOC Group for total consideration of $1.015-billion, sharpening its focus on near-term growth in North America.
The transaction comprises $900-million in upfront cash, payable on closing, and a production-linked contingent cash payment of up to $115-million one year after closing. Completion is expected in the first quarter of 2026, subject to regulatory approvals and customary conditions.
The assets being sold include Equinox Gold’s 100% interests in the Aurizona mine, RDM mine and the Bahia Complex in Brazil.
Equinox Gold president and CEO Darren Hall said the divestment marked a strategic turning point for the company. “The sale. . . is a pivotal step to position Equinox Gold as a North American focused gold producer underpinned by robust cash flow and a tier-one growth profile," he said.
Monetising the Brazil operations not only simplified the portfolio, but also enabled the company to deploy capital toward higher-return, lower-risk, organic-growth opportunities in Canada and the US. "By concentrating on our long-life assets, including Greenstone in Ontario, Valentine in Newfoundland and Labrador, and Castle Mountain in California, we position the company to deliver stronger margins and sustainable returns," explained Hall.
“With Valentine ramping up, continued performance improvements at Greenstone, and steady contributions from Mesquite and Nicaragua, Equinox Gold is positioned to drive long-term per-share value for our shareholders.”
Following completion of the transaction, Equinox Gold’s operating portfolio will comprise the Valentine and Greenstone mines in Canada, the Mesquite mine in California, and the El Limón and Libertad mines in Nicaragua.
As Valentine and Greenstone reach nameplate capacity, and assuming stable performance across the remaining assets, the company expects gold production in 2026 of between 700 000 oz and 800 000 oz. Near-term organic growth options include the Valentine Expansion, Castle Mountain Phase 2 and a redefined development plan at Los Filos in Mexico. Formal production and cost guidance for 2026 is expected in early 2026.
Equinox Gold said the transaction followed a comprehensive review of its expanded asset base after the merger with Calibre Mining, during which the company received multiple inbound approaches. After assessing various alternatives, the board concluded that the sale maximises shareholder value by improving balance-sheet strength and increasing flexibility to fund its North American growth strategy.
Under the terms of the agreement, the contingent consideration of up to $115-million will be payable one year after closing if certain production thresholds are met. This includes a payment equivalent to 12.5% of revenue for production between 200 000 oz and 280 000 oz, or the full $115-million if production equals or exceeds 280 000 oz.
"The proceeds will transform our balance sheet and immediately strengthen our financial position by fully repaying our $500-million term loan and $300-million Sprott loan, and reducing our revolving credit facility. This will greatly reduce interest expense and enhance per-share cash flow. The company will have enhanced flexibility to self-fund organic growth and consider capital return initiatives within a disciplined capital allocation framework," said Hall.
