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MONTREAL – Business and politics mix freely in Quebec, sometimes in dangerous ways.
So when Yamana Gold Inc. announced early Wednesday it had struck a friendly deal to buy half of Montreal-based Osisko Mining Corp.’s mining and exploration assets while maintaining Osisko’s head office, it didn’t take long for provincial politicians to react. We are in an election campaign after all and in the eyes of some, there are points to be scored piggybacking on the affairs of private enterprise.
The governing Parti Québécois, eager to cast itself as the best defender of made-in-Quebec businesses, quickly called a press conference to discuss the transaction.
“This is very good news for Quebec’s mining industry,” declared natural resources minister Martine Ouellet, noting the partnership will split assets including Osisko’s flagship Canadian Malartic gold mine in the Abitibi region of Quebec. Finance Minister Nicolas Marceau focused on the role of the Caisse de dépôt et placement du Québec in the deal, saying the pension fund’s presence as a financial backer ensures Osisko will remain an independent publicly traded company.
For its part, Quebec’s Liberal Party, which is set to take power April 7 according to the latest poll, has insisted it wants any deal for Osisko to be a friendly one. It didn’t call a news conference to talk about Yamana’s agreement because, as Liberal finance spokesman Carlos Leitao said: “It’s a private deal. So if the board of Osisko is happy, then we are happy.”
But that’s not the end of it. Mr. Leitao said if a Liberal government had been in power when Osisko was put in play by Goldcorp Inc.’s hostile offer in January, it would have moved quickly to try to influence the outcome with the goal of keeping Osisko’s head office in Montreal.
“We would have stepped in a lot earlier in this process,” Mr. Leitao said Thursday. “We would use a portion of [Quebec’s dedicated debt repayment Generations Fund] to take a stake in a business that is under attack.”
Mr. Leitao said the Liberals would carve out a maximum of 20% of the fund, which has current assets of about $5.6-billion, and take a maximum 10% stake in the Quebec company. The minister of finance has discretionary power over the fund.
For the rest of this article, click here: http://business.financialpost.com/2014/04/03/how-quebec-politicians-are-piggybacking-on-the-battle-for-osisko-mining/