Equinox to sell 10M Solaris shares

Growing gold miner Equinox Gold (TSX, NYSE: EQX) has announced that, in response to a request from Ecuador-focused explorer Solaris Resources (TSX: SLS), it has agreed to sell 10 million of the 27.8 million Solaris shares it currently holds at $8.25 a share. The miner will also grant the buyers, Augusta Investments (a B.C.-based corporation associated with Solaris chair Richard Warke) and a strategic shareholder, warrants to purchase 5 million Solaris shares for a 12-month period at $10 a share.

Proceeds from the sale are estimated at $82.5 million, increasing to $132.5 million in the event that the warrants are exercised.

In the release, Christian Milau, Equinox CEO, notes that the proceeds are expected to “further strengthen Equinox Gold’s already solid balance sheet as we continue to execute on our expansion and growth objectives.”

After the sale, Equinox will hold 17.8 million Solaris shares, or 16.9% of the company. If the buyers warrants are exercised, this would decrease to 12.2%. The producer also owns warrants to acquire 10.3 million shares; after the sale, if both the buyers and Solaris exercise their warrants, Equinox’s Solaris stake would increase to approximately 20%.

Equinox currently owns 26% of the explorer, in addition to the 10.3 million warrants. The company recently announced the results of an expansion study for its Castle Mountain mine in California and increased its stake in the preproduction Hardrock project in Ontario to 60%, from 50%.

Solaris’ flagship 268-sq.-km Warintza property in southeastern Ecuador features an open-pit copper-molybdenum-gold resource within a 5- by 5-km cluster of outcropping porphyries and is 40 km north of the Mirador copper mine, held by a Chinese state-owned company. Solaris is part of the Augusta Group, that also includes Equinox Gold.

For more information, visit www.EquinoxGold.com or www.SolarisResources.com.