Dumagami delays law suit, as Invesfor awaits merger

The law suit was launched by Dumagami following an alleged attempt by Montreal-based Invesfor to influence the terms of an amalgamation involving Dumagami and affiliate Agnico-Eagle Mines (TSE).

Invesfor, a company controlled by Forget, holds a 6.2% stake in Dumagami and claims to speak for a number of shareholders representing one million Agnico shares or a 10% interest.

Dumagami is attempting to force Invesfor to abide by the U.S. Securities and Exchange Act and refrain from soliciting proxies from U.S. shareholders of Dumagami Mines.

Now that the hearing has been delayed, the law suit may not go ahead as planned, said Forget.

Forget’s prediction is based on his belief that Dumagami and Agnico-Eagle will table the terms of the their proposed merger within the next two weeks.

Agnico-Eagle, which holds a 43% stake in Dumagami, has hired Midland Doherty of Toronto to evaluate the assets of the two companies before recommending a fair exchange ratio.

Prudential Bache Securities Ltd. of New York and Montreal-based Levesque Beaubien have also been hired by Dumagami to do a similar evaluation. Agnico secretary- treasurer Barry Landen refused to comment on a rumor that results of the evaluation are already available. “When we are good and ready, we will make an announcement,” he told The Northern Miner.

If and when the merger plans become available, Forget said he will sit down and take a look at them before deciding whether or not to proceed with his campaign for an exchange ratio of two Agnico shares for one Dumagami share.

“I expect the merger to be made by the beginning of July,” he said.

Meanwhile, Agnico-Eagle recently declared a 1988 net income loss of $5.1 million or 36 cents per share. Results for the first six months of 1988 will be announced by Dumagami this week.

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