Calibre Mining’s top shareholder has come out against Equinox Gold's $1.8-billion bid for the gold miner, casting uncertainty on the biggest bullion deal so far this year.

The combination of the two Canadian companies “dilutes the quality and potential” of Calibre, Imaru Casanova, a portfolio manager at Van Eck Associates Corp. who oversees the firm’s International Investors Gold Fund, wrote in an email Tuesday.

“We are not supportive of this transaction. We don’t see any synergies between any of the companies’ operations,” Casanova wrote. “Both operate in the Americas, but in vastly different locations.”

Calibre and Equinox both rose as much as 2.6% in Toronto on Tuesday. Equinox declined to comment. Calibre didn’t immediately respond to inquiries.

Vancouver-based Equinox agreed to buy Calibre in an all-stock deal in February in a bid to boost production of the precious metal and consolidate assets across the Americas. Equinox operates gold mines in Canada, Mexico, Brazil and the US, while Calibre operates mines in the US and Nicaragua. The transaction still requires shareholder and court approvals, and is supposed to close this quarter.

Van Eck owned 8.69% of Calibre as of March 17, making it the firm’s top shareholder, according to data compiled by Bloomberg. It was also the second-largest investor in Equinox as of December 31 data.

Both Equinox and Calibre are planning to hold shareholder votes that require support from two-thirds of ballots cast to approve the deal.

Gold miners are flush with cash after bullion prices hit repeated record highs over the past year, filling company coffers and boosting stocks. Some miners have pounced on the opportunity to consolidate assets and grow gold output, though the industry has previously been punished for mergers that hurt balance sheets and share prices. Equinox chairman Ross J. Beaty warned in September of “really stupid deals.”

Casanova said Van Eck expected to see Calibre’s stock climb as it moved forwards on a flagship project in Canada.

“Calibre was on the cusp of a rerate as it advanced Valentine to production,” she said. “The proposed combination dilutes the quality and potential of Calibre.”