Osisko reveals Yamana deal to counter Goldcorp bid
Quebec mining firm says the offer is an improvement on hostile takeover by Goldcorp
Osisko Mining Corp. has a new offer for half its mining and exploration assets that it says is better for shareholders than the hostile takeover bid by Goldcorp.
Osisko has been seeking an alternative since January to a hostile bid from Vancouver-based Goldcorp, which is particularly interested in its Malartic gold mine in Quebec.
“Since the middle of January our shareholders have been subjected to a low-value hostile offer. Today's announcement brings significantly greater value to our shareholders,” said Osisko president and CEO Sean Roosen.
The Osisko board will recommend the Yamana deal to shareholders. Goldcorp was to put its rival deal before shareholders on April 15.
“Our partnership with Yamana will also provide 50 per cent of the future funding for new exploration and development of these projects, reducing risk for our shareholders,” Roosen added.
Only about half of the cash will come directly from Yamana. The rest will come from two of Canada's largest pension fund managers, CPP Investment Board and the Caisse de depot et placement du Quebec through credit arrangements with the companies.
The deal will require approval by at a two-thirds majority vote by Osisko shareholders and optionholders. Osisko said it will hold a special meeting for shareholders before May 20.
Osisko shares rose 6.8 per cent to $7.35 a share on news of the deal, which values the entire company at $3.4 billion.
Under an agreement with Osisko, Goldcorp has been granted access to Osisko's confidential information to assess before making its next move. The senior gold miner must now decide if it wants to raise its offer or walk away from the bid, which is open until Friday at 5 p.m. ET.
Goldcorp said Wednesday it would need time to evaluate the new offer and would "provide comments in due course."