Vancouver's B2Gold Corp. (TSX:BTO) plans to merge with Toronto's Central Sun Mining Inc. (TSX:CSM) in an all-share deal worth $66.8 million.
Under the agreement, Central Sun shareholders will receive 1.28 B2Gold shares for each of Central Sun share. The deal values each Central Sun share at $0.65 a 45% premium over the January 26 closing price.
The combination of the two companies will transform B2Gold into a junior gold producer by acquiring Central Sun's Orosi mill project in Nicaragua. B2Gold expects initial gold production of 45,000 ounces, which will increase to 130,000 by the end of 2009.
As part of the deal, Central Sun will issue B2Gold a $10 million convertible debenture to fund immediate working capital requirements at Orosi.
B2Gold's share price range during the past week: between $0.51 and $0.83; 52-week high: $2.52; 52-week low: $0.30.