Osisko CEO says succesful Goldcorp bid would set bad precedent
Osisko Mining Corp. (TSX:OSK) again rubbished Goldcorp’s (TSX:G) (NYSE:GG) $2.6-billion hostile bidon Wednesday saying a successful offer would be negative for all investors in the gold sector.
The Financial Post reports the Montreal-based miner’s CEO Sean Roosen told a mining conference that if Goldcorp’s advances previously labelled as far too low and opportunistic should be accepted by shareholders and portfolio managers it implies companies like Osisko should never attract a premium:
“Losing access to a very entrepreneurial mid-tier [miner] that’s been a top performer in the space and the management team that built it, most [fund managers] feel that’s not helping their investment model,” he told reporters.
“And I think from an overall standpoint of investors, if you’re going to invest in growth assets and they’re going to trade at a zero premium at the end of the day, that doesn’t really make a business model for portfolio managers.”
Osisko shares were up 3.5% to $6.85 in Toronto on Wednesday amid a generally positive day for gold stocks and have traded well above the $5.95 implied value of the Goldcorp offer since the stock-and-cash proposal was first announced.
Osisko is advancing two exploration projects in Ontario and one Mexico and operates a single mine in the province of Quebec which entered production in May 2011. The Canadian Malartic mine is expected to produce 500,000 – 600,000 ounces of gold per year over its 16-year mine life, according to its current owner.
In its takeover offer circular, Goldcorp revealed this is not the first time it has attempted to gain control of Malartic. In fact, it has been discussing a possible deal for Osisko since 2008, but the firm “has continually refused to either negotiate or engage in meaningful dialogue,” Goldcorp said.
Goldcorp already has a gold project in Quebec – Éléonore, set to begin production later this year.