The deal, worth about C$2.57 per share, represents a 2% premium to Premier's Tuesday close according to Reuters.
It fits Equinox's strategy "to grow as big as we can as quickly as we can," chairman Ross Beaty said on a call.
Cost-conscious miners have bulked up as gold prices climbed to record highs of above $2,000 an ounce this year.
On Tuesday, private equity firm Orion Mine Finance Group said it would buy gold miner Centerra Gold Inc's 50% interest in the Greenstone Gold Mines partnership for $225 million in cash. Premier Gold has a 50% stake in the partnership, whose principal asset is the Hardrock mine in the Canadian province of Ontario.
Equinox CEO Christian Milau said the larger company would assess potential for dividends once that project is finished.
"It may be a two, three-year period before we really can get into thinking about dividends," he said.
Equinox shares fell on Wednesday while Premier Gold's stock price soared.
Under the deal, Premier shareholders will receive 0.1967 of an Equinox share for each share held and 0.4 of a share in the spin-out company i-80 Gold Corp, the companies said on Wednesday.
However, the exact value that Premier shareholders will get depends on the pricing of the spin-out company's shares.
Upon deal closing, Equinox Gold will own about 84% of Equinox Gold and Premier shareholders about 16%. Equinox Gold and the existing shareholders of Premier will own 30% and 70% of i-80 Gold, respectively, on an issued share basis.
The transaction is expected to close in the first quarter of 2021.
($1 = 1.2746 Canadian dollars)
(Reporting by Arunima Kumar in Bengaluru; additional reporting by Jeff Lewis in Toronto; Editing by Amy Caren Daniel and David Gregorio)
