VANCOUVER, BRITISH COLUMBIA and TORONTO, ONTARIO--Feb 2, 2009 -- B2Gold Corp. (Toronto:BTO.TO - News) ("B2Gold" or the "Company") and
Central Sun Mining Inc. (Toronto:CSM.TO - News)(AMEX:SMC - News) ("Central
Sun" or "CSM") announce that they have signed a binding
agreement (the "B2Gold Transaction") to combine the two
companies at the agreed exchange ratio of 1.28 B2Gold shares
per Central Sun share, which represented a purchase price
of approximately Cdn$0.65 per Central Sun share using closing
share prices on January 26, 2009 and represented a 45% premium
over the CSM closing price on January 26, 2009. Based on
the January 30, 2009 closing price of B2Gold on the TSX
of Cdn$0.83 per share, the transaction was valued at approximately
Cdn$1.06 per CSM share for a total transaction value of
Cdn$66.8 million.
The combination of B2Gold and Central Sun will result in
B2Gold commencing with initial production of approximately
45,000 ounces of gold per year and a planned production
of approximately 130,000 ounces of gold per year following
completion of the Orosi Mill Project scheduled for the fourth
quarter of 2009.
The Central Sun Board of Directors has unanimously recommended
that Central Sun shareholders vote in favour of the B2Gold
Transaction. Further, CSM officers, directors and shareholders
who hold approximately 13.5% of the outstanding shares have
entered into lock-up agreements with B2Gold, pursuant to
which they will vote their shares in favour of the B2Gold
Transaction.
In connection with the B2Gold Transaction, B2Gold and CSM
will enter into a convertible debenture agreement, pursuant
to which CSM will issue to B2Gold a convertible debenture
in the amount of up to Cdn$10 million on a subordinated
basis. CSM will use the proceeds of the debenture to fund
immediate working capital requirements and development expenditures
at the Orosi Mine to permit commissioning of the mill and
restart of operations in the fourth quarter of 2009. The
debenture will be repayable 30 days after any termination
of the agreement to effect the B2Gold Transaction. A portion
of the Cdn$10 million debenture is convertible at the option
of B2Gold at any time at an exercise price of Cdn$0.60 per
share for up to 9.9% of the issued and outstanding shares
of CSM at the time of conversion. Completion of the convertible
debenture agreement is subject to the satisfaction of certain
regulatory requirements.
Clive Johnson, President and Chief Executive Officer of
B2Gold, stated, "We are pleased to have signed this agreement,
which has received enthusiastic market support and upon
completion will immediately transform B2Gold into a producing
gold company and allow our team's financial and technical
resources to combine with Central Sun's strong team and
add value to Central Sun's operations and projects."
Peter Tagliamonte, President and Chief Executive Officer,
stated, "The market's reaction to the B2 Transaction has
been overwhelmingly positive for both groups of shareholders.
B2Gold has an exceptional foundation of exploration and
mining professionals and is led by one of the most entrepreneurial
and experienced management teams in the junior gold producer
space. This is an exciting period and represents a great
opportunity for CSM shareholders who will own a significant
stake in B2Gold."
Conference Call
A conference call will be held on Tuesday, February 3rd,
2009, 11 a.m. (Toronto)/8:00 a.m. (Vancouver) to discuss
the B2Gold Transaction. Please use the following information
to access the call:
In Vancouver: 604-899-4201
In Toronto: 416-883-7132
Toll Free: 888-205-4499
Pass code: 56742#
There will be a question and answer session following management
presentations during the call.
B2Gold Transaction Highlights
- Approximately Cdn$55 million in Cash and Cash Equivalents
at January 25, 2009, which is sufficient to fund the capital
expenditures required to achieve and sustain gold production
of 130,000 ounces per year;
- Management from B2Gold and Central Sun with their combined
extensive mine exploration, development, financing and operating
experience; and
- Strategic position and management experience to leverage
continued consolidation in the gold industry.
- A strong portfolio of mining, development and exploration
assets.
Upon completion of the B2Gold Transaction, B2Gold will have
approximately 245 million common shares issued and outstanding,
with former Central Sun shareholders holding approximately
33% of the issued and outstanding common shares of the combined
company.
B2Gold Transaction Details - Update
The B2Gold Transaction is subject to, among other things,
the parties entering into a definitive agreement by February
6, 2009, the receipt of all necessary regulatory and court
approvals and obtaining shareholder approval of the B2Gold
Transaction at special meeting of the Central Sun shareholders
to be held no later than April 30, 2009. Closing of the
B2Gold Transaction is set to occur by no later than April
30, 2009.
B2Gold's financial advisor is Genuity Capital Markets and
its legal counsel is Lawson Lundell LLP. Central Sun's financial
advisor is Macquarie Capital Markets Canada Ltd and its
legal counsel is Cassels Brock & Blackwell LLP.
The December 24, 2008 letter agreement between Central Sun
and Linear Gold Corp. regarding their previously proposed
business combination has been terminated in accordance with
its terms and Central Sun will be making a Cdn$1,000,000
termination payment to Linear Gold.
About B2Gold
B2Gold is a Vancouver based mineral and exploration company
founded by the former management team of Bema Gold Corporation.
Bema grew from a junior explorer to an international gold
producer that was acquired by Kinross Gold Corporation through
a Cdn$3.5 billion transaction in February 2007. B2Gold completed
a Cdn$100 million Initial Public Offering on the TSX Venture
Exchange on December 6th, 2007 and has recently graduated
to the Toronto Stock Exchange, trading under the symbol
BTO. The company's corporate objective is to capitalize
on the extensive experience and relationships that its management
team has developed in the mining business over the past
25 years, to build an intermediate gold company through
exploration and acquisitions. B2Gold has amassed interests
in a portfolio of exploration properties in Colombia and
Far East Russia.
About Central Sun
Central Sun Mining Inc. is a gold producer with mining and
exploration activities focused in Nicaragua. Central Sun
operates the Limon Mine in Nicaragua and is converting the
Orosi Mine in Nicaragua to conventional milling to increase
the annual gold output. It also holds a 60% interest in
the Cerro Quema Project in Panama, a 100% interest in La
India property and an option to acquire a 100% interest
in the Mestiza gold property both of which are located 70
kilometres by road east of its operating Limon Mine. The
Company is focused on efficient and productive mining practices
to establish high quality and cost effective operations.
Central Sun is committed to growth by optimizing current
operations, expanding mineral reserves and resources at
existing mines, exploring its extensive land holdings and
seeking strategic mergers or acquisitions in the Americas.
ON BEHALF OF B2GOLD CORP.
Clive T. Johnson, President and Chief Executive Officer
ON BEHALF OF CENTRAL SUN MINING INC.
Peter Tagliamonte, President and Chief Executive Officer
This communication does not constitute an offer to purchase
or exchange or the solicitation of an offer to sell or exchange
any securities of Central Sun or an offer to sell or exchange
or the solicitation of an offer to buy or exchange any securities
of B2Gold, nor shall there be any sale or exchange of securities
in any jurisdiction (including the United States) in which
such offer, solicitation or sale or exchange would be unlawful
prior to the registration or qualification under the laws
of such jurisdiction. The distribution of this communication
may, in some countries, be restricted by law or regulation.
Accordingly, persons who come into possession of this document
should inform themselves of and observe these restrictions.
The solicitation of offers to buy B2Gold shares in the United
States will only be made pursuant to a prospectus and related
offer materials that B2Gold expects to send to holders of
Central Sun securities, subject to the requirements of applicable
law. The B2Gold shares may not be sold, nor may offers to
buy be accepted, in the United States prior to the time
the registration statement (if any is filed) becomes effective
or an exemption from such requirements is available. No
offering of securities shall be made in the United States
except (i) by means of a prospectus meeting the requirements
of Section 10 of the United States Securities Act of 1933,
as amended, which would contain detailed information regarding
B2Gold and its management, as well as its financial statements,
or (ii) pursuant to an exemption from the registration requirements
of the United States Securities Act of 1933, as amended.
Cautionary Note Regarding Forward-Looking Information This
press release contains "forward-looking information" within
the meaning of applicable Canadian securities legislation.
Forward-looking information includes, but is not limited
to, statements with respect to the future financial or operating
performance of B2Gold and Central Sun and its projects,
statements regarding exploration prospects, statements regarding
synergies and financial impact of the proposed B2Gold Transaction,
the terms and conditions of the B2Gold Transaction, the
benefits of the proposed B2Gold Transaction, the identification
of mineral reserves and resources, costs of and capital
for exploration and development projects, exploration and
development expenditures, timing of future exploration and
development activities, expected production, requirements
for additional capital, government regulation of mining
operations, environmental risks, reclamation expenses, title
disputes or claims, limitations of insurance coverage and
the timing and possible outcome of pending litigation and
regulatory matters. Generally, forward-looking information
can be identified by the use of forward-looking terminology
such as "plans", "expects" or "does not expect", "is expected",
"budget", "scheduled", "estimates", "forecasts", "intends",
"anticipates" or "does not anticipate", or "believes", or
variations of such words and phrases or state that certain
actions, events or results "may", "could", "would", "might"
or "will be taken", "occur" or "be achieved".
Forward-looking information is based on various assumptions
and on the best estimates of CSM or B2Gold, as the case
may be, as of the date hereof, and is subject to known and
unknown risks, uncertainties and other factors that may
cause the actual results, level of activity, performance
or achievements of the Company (and the company resulting
from the successful completion of the proposed B2Gold Transaction)
to be materially different from those expressed or implied
by such forward-looking information, including but not limited
to: general business, economic, competitive, political and
social uncertainties; the actual results of current exploration
activities; delay or failure to receive board or regulatory
approvals; timing and availability of external financing
on acceptable terms; the business of B2Gold and Central
Sun not being integrated successfully or such integration
proving more difficult, time consuming or costly than expected;
not realizing on the potential benefits of the proposed
B2Gold Transaction; conclusions of economic evaluations;
changes in project parameters as plans continue to be refined;
future prices of mineral prices; failure of plant, equipment
or processes to operate as anticipated; accidents, labour
disputes and other risks of the mining industry; and, delays
in obtaining governmental approvals or required financing
or in the completion of activities, and as well as those
risks identified under "Risk Factors" disclosure sections
in the documents filed under the profile of SEDAR by CSM
and/or B2Gold from time to time. Although the Company has
attempted to identify important factors that could cause
actual results to differ materially from those contained
in forward-looking information, there may be other factors
that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such information
will prove to be accurate, as actual results and future
events could differ materially from those anticipated in
such statements. Accordingly, readers should not place undue
reliance on forward-looking information. The Company does
not undertake to update any forward-looking information,
except in accordance with applicable securities laws.
The Toronto Stock Exchange neither approves nor disapproves
the information contained in this News Release.
