Endeavor Mining Corp said on Tuesday it was in talks with fellow West African-focused gold mining company Teranga Gold over a potential merger, as it looks to add heft at a time of soaring gold prices.

Teranga shares rose 10% in Toronto while shares of Endeavour fell 0.8%.

The announcement also comes at a time when prices of safe-haven gold have gained on the back of global stimulus to cushion economies from the fallout of the COVID-19 pandemic.

As of Monday's close, Endeavour had a market valuation of C$5.23 billion ($4 billion), while Teranga was worth C$2.2 billion.

Bloomberg had previously reported that Endeavour Mining was exploring a purchase of Teranga, citing people with knowledge of the matter.

Earlier this year, Endeavour acquired mining firm Semafo to create the biggest gold producer in Burkina Faso, increasing its focus on the country despite rising insecurity.

The Teranga deal, if completed, would add another operating mine – Wahgnion – to Endeavour's four existing mines in Burkina Faso, and also give the company exposure to Senegal with Teranga's operations.

Teranga bought Barrick Gold's 90% stake in the Massawa project in Senegal last year in a $430 million deal.