B2Gold (BTO.TO) has kept its Sector Perform rating and US$4 price target, RBC Capital Markets said in a Thursday note.

This is after B2Gold announced the offering of $350 million in convertible unsecured senior notes to fund working capital requirements and for general corporate purposes. The interest rate and conversion rate are pending. The company will also enter into a cash settled one-month total return swap for up to $50 million (near 21 million shares at spot) with one of the initial purchasers of the notes.

RBC's view is 'negative', saying it expects investors to react negatively, citing the likely initial read through that additional capital could be required for the Goose project and also that management is "not fully comfortable" with the amount of available capacity/working capital levels heading into a critical year for execution and growth in both Canada and Mali.

Nonetheless, RBC said, on 2025 guidance and even with modest additional capital needs at Goose (ahead of first gold expected in Q2 2025) its spot model did not indicate the need for additional funding beyond the existing credit facility and cash on hand entering the year. Longer term, it added, this move may be seen as prudent, increasing balance sheet flexibility in the face of a number of potential risks to FCF generation over the next 18-24 months, including permitting at Fekola (40% of NAV), the start up and ramp up of Goose in the second half (35% of NAV), and the gold prepay deliveries from mid-25 to mid-26 suppressing FCF in year one of production. Despite the attractive valuation vs. peers (after having underperformed the GDX index by 52% over the last year), near-term potential risk on the ramp-up in Nunavut and permitting/political risk in Mali inform RBC's Sector Perform rating until there is more visibility into growing FCF in the second half of 2026.

B2Gold's share price was down 6.5% at last look on the TSX.