Because there has been so much bluffing between Detour Gold Corp. and activist investor Paulson & Co., any bets on whether the miner will ever hit the auction block might as well be settled by a coin flip.
But should the miner ever hang out a for-sale sign, a handful of large, respected rivals are expected to show interest, according to analysts at CIBC World Markets. At the top of the list are Barrick Gold Corp. and Goldcorp Inc.
Recent speculation on potential suitors comes after Paulson revealed Wednesday that Detour has been approached by a “major mining company” that is interested in buying it, which sent the stock 12 per cent higher. A day later, Paulson dialled up its rhetoric, announcing that “it intends to” call a special shareholder meeting to replace a majority of the miner’s board – but fell short of actually doing so.
On Thursday, Detour called the activist’s bluff. In a statement, the miner wrote that “we have heard this for many months now. If they choose to proceed, shareholders will have a stark choice – a fire sale by a U.S. hedge fund versus an experienced team executing the 2018 life of mine plan.” The stock closed down 2.6 per cent at $13.35.
Detour’s shares have largely slid for 24 months, but they were dealt a significant blow in April after the company released another disappointing revision to its mine plan, and also lowered its 2018 production guidance.
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