Osisko Mining Corp on Thursday, squeaking above a white knight bid by Yamana Gold Inc and heightening a bidding war that has helped inject life into a depressed gold mining sector.
Vancouver-based Goldcorp, the world’s second-biggest gold miner by market value, said early on Thursday it increased its offer for Osisko by some 38 percent to about C$3.6 billion ($3.3 billion), or C$7.65 a share.
Osisko is a smaller Canadian gold miner with one producing mine, Canadian Malartic in Quebec. The mine is an attractive asset as it is large and low-cost and located in a stable political jurisdiction.
Goldcorp shares fell nearly 4 percent following the news, reducing the value of its cash-and-stock bid to around C$7.47 a share. Still, the offer remained around 4 percent higher than Yamana’s cash-and-shares offer, based on analysts’ estimates.
Yamana, another Canadian gold miner, launched a complex offer for 50 percent of Osisko’s assets last week. It said at the time that its offer was valued at C$7.60 a share although analysts have pegged it lower than that. Some Osisko shareholders said the new Goldcorp bid was no blockbuster.
Goldcorp “haven’t done that knockout bid where they forced me to tender,” said Charles Oliver, senior portfolio manager at the Sprott Gold and Precious Minerals Fund, which has C$214 million of assets under management. Osisko was the fund’s second-biggest holding at the end of March.
Oliver, describing the Yamana deal as “a little complex”, said he did not plan to tender his Osisko stock to either offer, preferring Osisko as a standalone company.
Osisko shares closed 0.5 percent higher at C$7.58 on the Toronto Stock Exchange on Thursday. Goldcorp’s were down 3.9 percent at C$26.78, and Yamana’s were down 1.7 percent at C$9.44.
The fight for Osisko is the first major takeover tussle in the Canadian gold industry in more than a year. Dealmaking dried up after many miners wrote down the value of billions of dollars of assets that they had purchased at sky-high prices as the bullion price ran up in the last decade.
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