Equinox Gold Corp.'s stock tumbled 5.27% in pre-market trading on Wednesday, following the announcement of its agreement to acquire Orla Mining in an all-share deal to create a North American gold mining giant.

The proposed merger, which would create a company with an implied market capitalization of approximately $18.5 billion and expected annual production of 1.1 million ounces of gold, has been met with investor skepticism. Analysis suggests the market reaction may be mixed, with questions arising about the timing and strategic rationale behind the combination of the two companies.

TD Cowen analyst Wayne Lam noted that the deal "may not be every investor's cup of tea," expecting a divided response from shareholders of both companies. Investors appear concerned that both Equinox Gold and Orla Mining were seemingly positioned for solid growth as standalone entities prior to the merger announcement.