June 3, 2014 / 12:57 PM / 5 years ago

Canada's B2Gold to buy Papillon Resources for $570 million

(Reuters) - Canada’s B2Gold Corp said it would buy Australia’s Papillon Resources Ltd in an all-stock deal worth $570 million, to gain access to its Fekola gold deposit in Mali.

B2Gold will offer Papillon’s shareholders 0.661 B2Gold common shares for each ordinary Papillon share held.

The offer translates to A$1.72 ($1.59) per share, representing a 21 percent premium to Papillon’s close on May 23, the stock’s last trading day.

The proposed merger increases B2Gold’s measured and indicated mineral resources by 25 percent.

B2Gold said it expected to produce between 395,000 and 400,000 ounces of gold in 2014 from three operating mines, with output expected to grow to more than 900,000 ounces of gold by 2017 from five operating mines.

B2Gold’s financial advisers include Canaccord Genuity Corp and Raymond James Ltd. Lawson Lundell LLP is the company’s Canadian legal counsel and its Australian legal counsel is K&L Gates LLP.

Macquarie Capital is Papillon’s financial adviser on the deal. Its Australian legal counsel is Hardy Bowen and its Canadian legal counsel is Stikeman Elliott LLP.

B2Gold’s stock closed at C$2.62 on the Toronto Stock Exchange on Monday.

Reporting by Sneha Banerjee in Bangalore; Editing by Simon Jennings

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