Kirkland Lake Gold won’t budge as large Detour shareholder pushes for better offer – by Niall McGee (Globe and Mail – January 18, 2020)

Kirkland Lake Gold Ltd. has no intention of improving its $4.9-billion all-stock offer for Detour Gold Corp., despite calls from one of Detour’s biggest shareholders for a last-minute sweetener.

Toronto-based Kirkland offered 0.4343 of its own shares for each Detour share, a 24-per-cent premium to the Nov. 22 closing price. “We can’t, and don’t intend to, change the terms,” Tony Makuch, chief executive of Kirkland Lake, said in an interview on Friday. “It’s a full and fair offer.”

Even though no other bidder surfaced with a higher offer for Toronto-based Detour, the market had been been anticipating that Kirkland might improve its bid. Over the past few weeks, shares in Detour consistently traded above Kirkland’s offer, before finally dropping a few cents below it, on Friday.

When the deal was announced, Kirkland shares fell by 17 per cent, wiping out much of the paper premium, as investors worried about the merits of one of the world’s most profitable miners buying a low-grade laggard.

Kirkland has repeatedly argued that the Detour acquisition will significantly add to its gold reserves. While Kirkland’s marquee Fosterville mine in Australia has been a spectacular success in terms of grade, it has a short mine life.

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