Goldcorp (G-T) has responded to the increased takeover offer from Glamis Gold (GLG-T) by offering a cash dividend to its shareholders, conditional on approval of its plan to take over Wheaton River Minerals (WRM-T).
Goldcorp’s planned dividend of US50 (62) is comparable to the increase in Glamis’s offer, announced yesterday. Glamis is now offering 0.92 of a Glamis share for one Goldcorp share, an increase from an earlier exchange ratio of 0.89 that represented about 61 per share (US49).
Goldcorp management rejected the new Glamis bid, and Glamis, for its part, described the dividend plan as “desperation.”
Goldcorp and Wheaton management both continue to recommend their merger plan, which goes to a vote of Goldcorp shareholders on Feb. 10. Wheaton shareholders then have one day to tender shares to the Goldcorp bid, which offers 0.25 of a Goldcorp share for one Wheaton. Goldcorp’s dividend would go to shareholders of record on Feb. 16, before the distribution of Goldcorp shares to Wheaton shareholders.
Proxy deadlines have now passed for both Glamis — which was seeking proxies from Goldcorp shareholders against the Wheaton merger plan — and for Goldcorp management.
Both Goldcorp and Wheaton said the dividend — which would cost about US$95 million — would have “no material impact” on the finances of the merged companies. The merged company would have about US$365 million in cash, and the payout would flip retained earnings into a US$21-million deficit from a US$74-million surplus.
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