Osisko Mining Corp. officials are reviewing an unsolicited $2.4 billion takeover proposal by Goldcorp Inc. as their CEO called its 15% premium both “very low” and “opportunistic;” the company’s key asset is its Malartic gold mine in Quebec containing some 10 million oz of gold reserves.
Montreal-based Osisko officials have urged shareholders to refrain from accepting the tender, pending a special board review. CEO Sean Roosen declined to offer an acceptable price, but voiced hopes that stockholders would spurn the offer.
Roosen, moreover, said Osisko has already worked hard to begin operations, especially in easing tensions with community and regulators. “This is a number one asset in the gold space by a wide range now,” he told Canadian television. “We brought it to value.”
For their part, Vancouver-headquartered Goldcorp officials said they decided to proceed after frustrated attempts to engage Osisko, according to a Reuters report. “It’s got very low technical risk because it’s in production and the ore body is simple and understandable,” Goldcorp CEO Chuck Jeannes told the news agency.
Goldcorp was once a lead Osisko shareholder, but sold its 10.1% stake in 2011 for $530 million. Since then, “we’ve had numerous conversations — most recently last year when they decided to stop discussions with us,” Jeannes also told Canadian reporters. “We just decided it was time to let the shareholders decide.”
Goldcorp officials said the addition would provide immediate cash to enable ramp-ups of high yield projects at Cerro Negro in Argentina, as well as Éléonore and Cochenour, both also in Quebec, through Q2 2015 along with “opportunity for corporate and regional synergies.”