Thursday, July 24, 2014

Osisko Mining announces new deal with Yamana Gold and Agnico Eagle

MONTREAL — Osisko Mining Corp. (TSX:OSK) has signed a new friendly deal valued at $3.9 billion that will see the gold miner acquired by Yamana Gold (TSX:YRI) and Agnico Eagle Mines Ltd. (TSX:AEM).
Osisko’s main asset is the Canadian Malartic mine in Quebec.

The offer tops a rival hostile bid by Goldcorp (TSX:G) that was valued at $3.6 billion or $7.65 per share.
“With the announcement today of the combined bid by Yamana and Agnico Eagle, I believe we have delivered shareholders the superior value option to the hostile attempt to acquire our company,” Osisko president and chief executive Sean Roosen said Wednesday.
The deal will also see Osisko shareholders receive shares in a new company that will hold a net smelter return royalty on the Canadian Malartic mine as well as the company’s existing exploration properties as well as $155 million cash and the company’s Guerrero exploration project.
“The new Osisko will be a company with regular and strong cash flow, strong future potential for increasing cash flow, and tremendous upside exploration potential,” Roosen said.
Under the stock-and-cash agreement with Yamana and Agnico-Eagle valued at $8.15 per share, Osisko shareholders will receive $2.09 in cash, 0.26471 of a Yamana share, 0.07264 of an Agnico Eagle share and one new share in the new Osisko with a value of $1.20 per share.
Osisko shares were up 45 cents at $7.88 in trading on the Toronto Stock Exchange on Wednesday morning.
The new offer including Yamana and Agnico Eagle follows a decision last week by Goldcorp to raise its bid for the company. Under that proposal, which requires at least 50.1 per cent of Osisko shares be tendered, shareholders would receive $2.92 cash and 0.17 of a Goldcorp common share.
It also tops an earlier arrangement Osisko had signed with Yamana and two of Canada’s largest pension funds that valued Osisko at about $3.4 billion.
The announcement came as Goldcorp said it would seek to replace the board of directors at Osisko with its own slate of nominees.
Goldcorp said Wednesday it would nominate 11 people including its own chief executive Chuck Jeannes to the Osisko board for election at the company’s annual meeting next month.
All the proposed Goldcorp nominees, except for one who is nominated as a director of Goldcorp at its upcoming annual meeting, are currently directors or executives at Goldcorp.

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