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MONTREAL and TORONTO – Osisko Mining Corp. has another month to find a white knight after a Quebec Superior Court judge set a trial date in early March to hear the merits of a lawsuit the Montreal gold miner brought against its hostile suitor Goldcorp Inc.
On Tuesday, lawyers for Vancouver-based Goldcorp rejected as “fabrication” Osisko’s claims that Goldcorp misused confidential information when it made a $2.6-billion hostile offer for Osisko, saying the Montreal-based miner launched legal action simply to buy time.
“When we see judicial procedures like these, typically the party bringing them forward is trying to torpedo the offer because there are no other bids,” said Alain Riendeau, a Fasken Martineau lawyer acting for Goldcorp.
A three-day trial has been scheduled, starting March 3. Among the witnesses expected to testify are Goldcorp chief executive Chuck Jeannes. Under the terms spelled out by Judge Louis Gouin on Tuesday, Goldcorp agreed not to challenge Osisko’s shareholder rights plan (or “poison pill”) until March 6.
At the same time, Goldcorp agreed not to take up and pay for shares tendered under the bid until the judge renders his decision in the case. Osisko wants Judge Gouin to block the bid entirely.
Goldcorp’s cash-and-share offer is currently due to expire Feb. 19. This trial ensures that it will need to be extended.
What’s happening now in court is the result of a once-chummy relationship gone sour.
After several years of on-again, off-again talks and three separate takeover proposals by Goldcorp that Osisko considered inadequate, the two miners entered serious merger discussions in the fall of 2012. The goal, according to Osisko, was always to do a friendly deal, and both parties signed a two-year confidentiality agreement expiring Oct.16, 2014. The agreement included a one-year standstill clause that prevented Goldcorp from making a hostile bid for Osisko during that time.
Five days after the standstill expired, officials from the two companies met at a hotel near the airport in Calgary for a detailed discussion of Osisko’s business. It was a crucial all-day meeting – and what was said or not said is at the heart of the legal battle now.
For the rest of this article, click here: http://business.financialpost.com/2014/02/04/osisko-lawsuit-against-goldcorp-gets-march-trial-date/