B2Gold Corp.

Published : January 27th, 2009

Proposes a Superior Business Combination to Central Sun

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B2Gold Proposes a Superior Business
Combination to Central Sun

Vancouver, January 27, 2009 - B2Gold Corp. (TSX: BTO) ("B2Gold" or the "Company") announces that it has made a superior proposal to Central Sun Mining Inc. (TSX: CSM) (NYSE ALTERNEXT US: SMC) ("Central Sun" or "CSM") to combine the two companies at the agreed exchange ratio of 1.28 B2Gold shares per Central Sun share, which represents a purchase price of approximately Cdn$0.65 per Central Sun share using closing share prices on January 26, 2009 (the "B2 Transaction") and represents a 44% premium over the CSM closing price on January 26, 2009. B2Gold has been advised that the Central Sun Board of Directors has unanimously determined that the B2 Transaction is superior to the Linear Transaction and has resolved that if Linear Gold does not amend its proposal to be at least equivalent to the B2 Transaction by Friday, January 30, 2009, then Central Sun will execute the binding agreement provided by B2Gold and will recommend that Central Sun shareholders vote in favour of the B2 Transaction.
The combination of Central Sun and B2Gold would result in:

  • Initial production of approximately 45,000 ounces of gold per year and expected to increase to 130,000 ounces of gold per year following completion of the Orosi Mill Installation scheduled for the fourth quarter of 2009;
  • 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.

Upon completion of the B2 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.

Clive Johnson, President and Chief Executive Officer of B2Gold, stated, "We are pleased at the prospect of this strategic acquisition, which 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. This combination also marks our first step and commitment to achieving our goal of becoming an intermediate gold producing company."

B2 Transaction Details

The B2 Transaction is expected to be structured as a plan of arrangement between Central Sun and a newly formed, wholly-owned subsidiary of B2Gold. Under the terms of the B2 Transaction, CSM shareholders will receive 1.28 common shares of B2Gold for each common share of Central Sun held. Each outstanding Central Sun convertible security will become exercisable for B2Gold common shares based on the exchange ratio and resulting price adjustment. Two CSM directors, to be mutually agreed, will join the B2Gold Board of directors.

The B2 Transaction will be subject to approval of the shareholders of CSM. The Board of Directors of Central Sun has unanimously resolved that if Linear Gold does not amend its proposal to be at least equivalent to the B2 Transaction by Friday, January 30, 2009, it will enter into the agreement with B2Gold and will recommend that CSM shareholders vote in favour of the B2 Transaction. If Linear Gold waives its "right to match" under the Linear Transaction no later than January 30, 2009, the provisions require Central Sun to pay a break fee of Cdn$1 million to Linear Gold under certain circumstances. Macquarie Capital Markets, acting as advisor to the CSM Board of Directors has provided an oral opinion that the B2Gold offer is fair, from a financial point of view, to CSM shareholders.

B2Gold has been advised by CSM that the CSM officers, directors and shareholders who hold approximately 10.5% of the outstanding CSM common shares will enter into lock-up agreements at the same time as CSM enters into the agreement with B2Gold, pursuant to which they will agree to vote in favour of the B2 Transaction on the terms proposed above, subject to certain conditions. The Board of B2Gold has received an opinion from Genuity Capital Markets that the consideration offered is fair, from a financial point of view, to B2Gold's shareholders.

The letter agreement setting out the B2 Transaction includes a commitment by Central Sun not to solicit alternative transactions to the proposed B2 Transaction and a commitment to sign a Definitive Agreement by February 6, 2009. B2Gold has also been provided with certain other rights customary for a transaction of this nature, including the right to match competing offers made to CSM. The letter agreement also provides for a break fee of Cdn$2 million to be payable to B2Gold in certain circumstances.

The B2 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 B2 Transaction at special meeting of the Central Sun shareholders to be held no later than April 30, 2009. Closing of the B2 Transaction is set to occur by no later than April 30, 2009.

Cdn$10 Million Convertible Debenture

In connection with the B2 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 further development expenditures at the Orosi mine to permit commissioning of milling operations by fourth quarter of 2009. The debenture will be repayable 30 days after any termination of the agreement to effect the B2 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.

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 and its legal counsel is Cassels Brock & Blackwell LLP.

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.
  

On Behalf of B2GOLD CORP.

"Clive T. Johnson"
President and Chief Executive Officer

For more information on B2Gold please visit the Company web site at www.b2gold.com or contact:

Ian MacLean
Vice President, Investor Relations
604-681-8371
investor@b2gold.com

Kerry Suffolk
Manager, Investor Relations
604-681-8371
investor@b2gold.com
  

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 B2 Transaction, the terms and conditions of the B2 Transaction, the benefits of the proposed B2 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 B2 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 B2 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.

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Data and Statistics for these countries : Colombia | Russia | All
Gold and Silver Prices for these countries : Colombia | Russia | All

B2Gold Corp.

PRODUCER
CODE : BTO.TO
ISIN : CA11777Q2099
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B2Gold is a gold producing company based in Canada.

Its main assets in production are LIMON and LIBERTAD MINE in Nicaragua, its main assets in development are OROSI in Nicaragua and GRAMALOTE in Colombia and its main exploration properties are MOCOA and QUEBRADONA in Colombia, SAN PEDRO, CALIBRE, TREBOL, EL PAVON and MESTIZA-LA INDIA in Nicaragua, BELLAVISTA in Costa Rica and CEBOLLATI in Uruguay.

B2Gold is listed in Canada and in United States of America. Its market capitalisation is CA$ 4.6 billions as of today (US$ 3.7 billions, € 3.2 billions).

Its stock quote reached its lowest recent point on October 24, 2008 at CA$ 0.30, and its highest recent level on August 07, 2020 at CA$ 9.99.

B2Gold has 973 449 984 shares outstanding.

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