https://www.theglobeandmail.com/
Eric Sprott says he intends to vote for Kirkland Lake Gold Ltd’s controversial $4.9-billion takeover of Detour Gold Corp.
Initially undecided on the merits of the deal, Mr. Sprott says he came around after studying up on Detour, and after reflecting on Kirkland’s plans for the struggling low grade miner.
Kirkland has plans to eventually cut Detour’s costs to US$800 an ounce from US$1,100, and materially boost its production. “I think it would be a pretty good cash generating machine,” Mr. Sprott said of Detour.
The billionaire mining maverick is Kirkland’s second biggest investor, with holdings of more than 13 million shares. Getting Mr. Sprott onside is key to the success of the deal, which so far hasn’t had a great reception.
Last week, investors reacted with shock after the deal was announced, with some questioning why Kirkland, one of the most profitable mining companies in the world, wanted to buy a high cost competitor. One analyst called it a “head scratcher.”
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