Goldcorp Raises Offer to Buy Osisko - Analyst Blog


Gold miner Goldcorp Inc. ( GG ) announced that it has raised its offer to buy all of the outstanding common shares of Osisko Mining Corporation to C$7.65 per Osisko share for a total consideration of roughly C$3.6 billion ($3.3 billion). Osisko shareholders who tender to the offer will receive 0.17 of a Goldcorp common share and an increase in the cash portion of the offer to a total of C$2.92 for each Osisko share.

The increased bid for Osisko represents superior value for its shareholders and also ensures accretion on key per-share metrics for Goldcorp shareholders. Osisko shareholders will retain continued exposure in the Canadian Malartic gold mine and will participate in Goldcorp's increasing portfolio of world-class assets.

Previously, Goldcorp made an offer to acquire all of the outstanding common shares of Osisko for about C$2.6 billion (roughly $2.4 billion) in cash and shares. Under the terms of the Offer, Osisko shareholders were entitled to receive 0.146 of a Goldcorp common share and C$2.26 in cash for each Osisko share.

Goldcorp also recently extended its offer date to acquire all of the outstanding common shares of Osisko to Apr 15, 2014.

Recently, Goldcorp filed National Instrument 43-101 technical report pertaining to its 100% owned Eleonore project in Quebec and its 40% owned Pueblo Viejo mine in Central America.

The Eleonore mine is expected to commence production from late 2014. Goldcorp expects gold production in 2014 to be in the band of 40,000-60,000 ounces. Average annual gold production, once the mine reaches full production, is expected to be about 600,000 ounces. Gold reserves are expected to be 4 million ounces. Total capital expenditure is expected to be between $1.8 and $1.9 billion. Roughly $1.3 billion has been already spent for the completion of the project.

Goldcorp currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the gold mining industry include AngloGold Ashanti Ltd. ( AU ), Lake Shore Gold Corp. ( LSG ) and Golden Star Resources, Ltd. ( GSS ). While AngloGold and Lake Shore Gold carry a Zacks Rank #1 (Strong Buy), Golden Star Resources holds a Zacks Rank #2 (Buy).

ANGLOGOLD LTD (AU): Free Stock Analysis Report

GOLDCORP INC (GG): Free Stock Analysis Report

GOLDEN STAR RES (GSS): Free Stock Analysis Report

LAKE SHORE GOLD (LSG): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: AU , GG , GSS , LSG

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