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TORONTO/MONTREAL – The shares of Osisko Mining Corp. are trading well above his offer price, and investors and analysts are clamouring for a higher bid. But Ian Telfer maintains everything is going “extremely well.”
The chairman of Goldcorp Inc. remains confident his company’s $2.8-billion hostile offer for Montreal-based Osisko will succeed. In an interview in Toronto Tuesday, he pointed out that Osisko is running out of time to find a white knight bidder, and added that the “Just Say No” defence almost never works.
“Because there’s no other bidder, we see no reason to bid against ourselves,” he said in an interview. “You can’t have an auction with only one bidder.”
Osisko delayed Goldcorp’s hostile approach with a lawsuit that got settled this month. Mr. Telfer said Goldcorp got “exactly what we wanted” out of the settlement as it eliminated Osisko’s poison pill and will allow Goldcorp to do more due diligence starting next week on Osisko’s Canadian Malartic mine in Quebec. It is his understanding that Osisko’s board pushed its management team to settle with Goldcorp.
Goldcorp could raise its bid depending on what the due diligence reveals, but Mr. Telfer made no promise to do so.
“If we were to take our bid away, I think this stock would drop significantly, like 20%. I think the large shareholders will be taking that into consideration,” he said.
As for Osisko’s future as a standalone company with no takeover, he said the company’s growth strategy “has not worked,” noting that it has taken writedowns on assets it acquired outside Quebec.
There is also a political element to this battle.
Goldcorp’s hostile offer has creeped into Quebec’s election campaign, with each of the three main parties expressing concern over the future of Osisko — by far the province’s largest home-grown miner.
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