Canadian gold companies Yamana Gold Inc. and Agnico-Eagle Mines
Ltd. said they have reached agreement to buy Osisko Mining Corp.
for C$3.9 billion ($3.6 billion), in what could prove be one of the
largest mining deals so far this year.
The joint offer consists of around C$1 billion in cash, C$2.3
billion worth of Yamana and Agnico-Eagle shares, and the creation
of a company, New Osisko, with an implied value of about C$575
million, the companies said.
The offer represents an 11% premium to a rival, hostile bid for
Osisko from mining giant Goldcorp Inc.
Following the completion of the transaction, Osisko shareholders
would own about 14% of Yamana and around 17% of Agnico-Eagle, the
companies said.
The deal would give Yamana and Agnico-Eagle control of Osisko's
flagship Canadian Malartic gold mine in northern Quebec. Investors
will receive shares in New Osisko, which will hold a small
portfolio of Osisko's assets and liabilities.
The deal will address analysts' criticisms that a previous offer
by Yamana could prove too complicated for investors. On April 2,
Yamana had agreed to take a 50% stake in the mining assets of
Osisko, which said it would also sell the rights to a stream of
gold from Canadian Malartic as one part of a wider C$550 million
financing from two big Canadian pension funds.
The higher bid for Osisko from Yamana and Agnico-Eagle appears
to nullify Goldcorp's latest attempt to win the takeover battle.
Earlier Wednesday, Goldcorp said it planned to try to win
shareholder support to replace Osisko's board with its own slate as
part of its attempt to gain control of the Quebec miner. But its
cash and stock offer, currently worth about C$3.6 billion, remains
below the Yamana and Agnico-Eagle bid.
A spokeswoman for Goldcorp wasn't immediately available to
comment.
The new offer comes on the heels of Glencore Xstrata PLC selling
its Las Bambas Peruvian copper project to a Chinese consortium in
an all-cash deal worth at least $5.8 billion, amid an overall
recent lull in mining deals.
Write to Alistair MacDonald at alistair.macdonald@wsj.com and
Ben Dummett at ben.dummett@wsj.com
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