B2Gold Sells Mines & Assets In Nicaragua To Calibre Mining

 | Jul 03, 2019 08:50AM ET

B2Gold Corp. (NYSE:BTG) has inked an agreement per which the company will sell two gold mines and assets in Nicaragua to Calibre Mining Corp. for $100 million and 31% direct equity interest in Calibre.

The two concerned gold mines are the El Limon and La Libertad Gold Mines, which B2Gold had acquired in 2009. The deal also includes the Pavon gold project and additional mineral concessions in Nicaragua currently held by B2Gold. Over the past decade, the company has invested more than $560 million in Nicaragua. It has significantly improved operations and economics of the El Limon Mine and constructed a mill facility. It also commenced profitable gold production at the La Libertad Mine and realized significant exploration success around both mines. Since 2009, these mines have produced more than 1.4 million ounces of gold. For fiscal 2019, the gold production from the two mines is expected to be 150,000-160,000 ounces.

Through its significant equity interest in Calibre, B2Gold will be involved with the Nicaraguan operations and have right to appoint one director to the Board of Calibre and will be able to participate in an Advisory Board to the primary Board of Calibre.

The consideration will be paid by a combination of cash, common shares and a convertible debenture. The closing of the transaction is subject to certain conditions including majority of minority shareholder approval, the successful negotiation and execution of a definitive agreement by B2Gold and Calibre, the closing of the concurrent private placement by Calibre and satisfactory due diligence by Calibre.

The deal will enable the company to remain involved with the Nicaraguan operations. The La Libertad and El Limon Mines have been an important contributor to the local and national economies, accounting for a major percentage of the country's gold exports. Gold currently ranks third in Nicaragua’s main exports.

With Calibre and the combined Nicaraguan management team focusing on these mines and other opportunities in the country, B2Gold will concentrate on continuing to optimize responsible production at its other existing mines in Mali, Namibia and the Philippines. It will also work toward developing its impressive pipeline of development and exploration projects. Additionally, B2Gold will continue to pursue additional greenfield and advanced exploration opportunities.