Glass Lewis Backs Revised Calibre-Equinox Merger: A Strategic Shift to Secure Shareholder Approval

The proposed merger between Calibre Mining Corp. (TSX: CXB) and Equinox Gold Corp. (TSX: EQX) has gained critical momentum after proxy advisory firm Glass Lewis updated its recommendation to support the transaction. The shift, announced on April 25, 2025, followed amendments to the merger terms that recalibrated the exchange ratio to better align with market expectations. This development marks a pivotal step toward securing shareholder approval, with the Special Meeting of Securityholders now scheduled for May 1, 2025.

The Revised Terms: Balancing Risk and Reward

The amended terms, unveiled on April 23, 2025, revised the exchange ratio to 0.35 Equinox shares for each Calibre share, a 10% premium to Calibre’s pre-announcement share price on February 21, 2025. This adjustment addresses earlier concerns about equity dilution, ensuring Calibre shareholders receive greater downside protection while preserving long-term upside potential. Under the new terms, existing Equinox shareholders will own 61% of the combined company’s shares, while Calibre shareholders will hold 39% on a fully diluted basis.

Glass Lewis highlighted this recalibration as a key factor in its updated stance, emphasizing that the revised ratio aligns with broader market benchmarks for fairness. The proxy advisor also noted the strategic rationale of the merger, which aims to create a major gold producer with annual output exceeding 1.2 million ounces, positioning the combined entity as Canada’s second-largest gold miner and among the top 15 globally.

Why This Matters for Investors

The merger’s success hinges on securing 66⅔% approval from Calibre shareholders and a simple majority from excluded shareholders. While Equinox shareholders have already shown strong support (~70% preliminary approval), Calibre’s vote remains critical. Glass Lewis’s endorsement is a significant boost, as institutional investors often follow such recommendations.

The revised terms also reflect a strategic pivot to address investor skepticism. For instance, the $100 million in projected annual synergies—driven by operational efficiencies and cost reductions—bolster the case for the merger. These savings, combined with a diversified asset portfolio spanning five countries (including Canada, the U.S., and Nicaragua), aim to mitigate geopolitical risks and stabilize production.

Market Context and Risks

The gold sector in 2025 is characterized by consolidation and cost-cutting amid volatile prices. shows both companies’ shares have faced downward pressure, with Equinox trading at C$1.80 as of April 2025—a 28% decline from its 52-week high. The merger’s success could reinvigorate investor confidence, particularly if the combined entity achieves its $2.41 billion pro forma EBITDA target by 2026, assuming gold prices rise to $2,950 per ounce.

However, risks persist:
- Gold Price Volatility: A prolonged dip below $2,000/ounce could undermine profitability projections.
- Regulatory Delays: Approvals from Canadian and U.S. authorities remain uncertain.
- Shareholder Revotes: Calibre shareholders who initially opposed the deal may now switch their votes, but the April 29 deadline leaves little room for hesitation.

Conclusion: A Turning Point for Canadian Gold Mining

The Glass Lewis recommendation underscores the strategic adjustments made to address shareholder concerns, balancing risk mitigation with growth potential. With Equinox’s Greenstone Mine and Calibre’s Valentine Gold Project forming the backbone of a 590,000-ounce annual production base, the merger positions the combined entity to capitalize on rising demand for gold in a post-pandemic economy.

If approved, the deal could redefine Canada’s gold sector, creating a low-cost producer with the scale to weather market swings. Investors should weigh the 10% premium, the 70% Equinox shareholder support, and the $7.7 billion combined market cap against execution risks. For Calibre shareholders, voting FOR the merger now represents a chance to align with industry consolidation trends and secure a stake in a repositioned gold giant.

The outcome of the May 1 vote will determine whether this strategic realignment succeeds—or becomes another cautionary tale in an industry still navigating the fine line between ambition and risk.