A Brazilian state-run mining company is asking a court to block part of a USD$1 billion asset sale involving Equinox Gold Corp. (TSE: EQX) (NYSE American: EQX) and CMOC Group Ltd. (HKEX: 3993).
Companhia Baiana de Produção Mineral, known as CBPM, filed for an emergency injunction in Bahia state court. Additionally, it seeks immediate repossession of a mining lease area in northeastern Brazil. The company argues that Equinox held only a lease, not full ownership, of the concession.
Consequently, CBPM claims Equinox had no legal right to sell that specific asset. The disputed property forms part of the Bahia Complex, one of several Brazilian assets included in the transaction. However, CBPM’s court filing targets only that complex and no other properties.
Equinox agreed in December to sell its Brazilian operations to CMOC in a deal valued at USD$1 billion. Subsequently, the companies completed the transaction last month. The package included multiple mines and deposits across different Brazilian states.
CBPM alleges that Equinox finalized the sale without securing its express consent. Furthermore, it says that consent was a required condition under the lease agreement governing the mining area. The state-run company has asked the Bahia State Court of Justice to terminate the lease.
In addition, CBPM is seeking financial damages tied to the disputed transaction. CBPM president Henrique Carballal said the Canadian miner transferred a mining right that did not belong to it. He argued that the state entity retains control over the concession.
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Marins remain below some industry averages
Meanwhile, Equinox said it has not received formal notice of any lawsuit. Executive vice president Ryan King stated by email that the company believes it followed Brazilian law and honored its contractual obligations. He added that Equinox stands ready to defend its position in court if necessary.
However, King also indicated that the company remains open to discussions with the state government. He suggested both sides could pursue a mutually acceptable resolution. CMOC did not immediately respond to requests for comment.
Many Chinese businesses remain closed for the Lunar New Year holiday. Consequently, CMOC has yet to publicly address the allegations. The court’s decision on the emergency injunction could determine whether control of the Bahia Complex changes hands again.
Equinox has delivered strong share price gains over the past year, outperforming broader Canadian benchmarks. Additionally, the company generated roughly USD$1.51 billion in revenue in its latest reported year, with net income above USD$339 million. Production reached record levels in 2025, and management expects higher output in 2026.
However, margins remain below some industry averages, reflecting cost pressures and ongoing investment. Meanwhile, the company maintains a moderate debt load relative to equity. Analysts at Scotiabank and TD Securities rate the stock a Moderate Buy and project price targets above current levels. Consequently, investors continue to weigh gold price trends and execution risks when assessing future performance.
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