TORONTO (miningweekly.com) – Three mining juniors have signed a definitive agreement to combine their businesses into a new entity to be named Equinox Gold, and operate under the leadership of mining veteran and chairperson Ross Beaty, the companies said in a joint statement late on Wednesday.

Assisted by CEO Christian Milau and president Greg Smith, Equinox is expected to be a well-funded gold miner with a near-term strategy to become a profitable, multi-asset, low-cost gold producer, the companies advised.

The all-scrip deal will see Trek Mining acquire all outstanding shares of NewCastle Gold and Anfield Gold at a share exchange ratio of 0.873 Trek shares for each NewCastle share and 0.407 Trek Mining shares for each Anfield share. Shareholders of Trek and NewCastle will each own 44% of Equinox, with Anfield shareholders owning 12%.

The new company expects to trade on the TSX-V under the ticker symbol ‘EQX’.

Equinox will gain control over Trek’s Aurizona mine, in north-east Brazil, where construction has started and first gold is targeted for late 2018. The mine is expected to produce on average 136 000 oz/y of gold, with the potential to significantly increase output with subsequent mine development at Castle Mountain, in California.

Equinox will also gain a multi-asset gold and copper portfolio, comprising combined measured and indicated gold resources of 5.8-million ounces and inferred gold resources of 2.5-million ounces.

Drilling is currently proceeding to potentially increase resources at both the Aurizona and Castle Mountain properties; with the asset portfolio presenting several other gold and copper opportunities.

The combined company will have about C$98-million in cash and marketable securities, with plans to realise corporate general and administrative savings and sell selected noncore assets. The company also has access to a $85-million credit facility to fully fund the construction of Aurizona, and access for up to $200-million in funding for future project development and acquisitions, providing significant capacity to develop Castle Mountain and continue to grow the company.

Under the business combination agreement, Beaty will join as chairperson and invest approximately $20-million to become a significant shareholder, owning about 11% of Equinox after closing.

The deal is subject to Anfield and NewCastle shareholder approvals during special meetings planned to be held during December.