Yamana really wants Meridian

Yamana Gold (YRI-T, AUY-N, YAU-L) has extended and increased the cash in its bid to take over Meridian Gold (MNG-T, MDG-N) and has lowered the bar for acceptance of the offer.

Yamana is still offering 2.235 of its shares for one Meridian share but has increased the cash component to $6.50 from $4, valuing Meridian at a notional $3.5 billion. The bid, which had been extended to Sept. 24, will now be open until Oct. 2.

Yamana had already increased the cash in its bid on Aug. 14, from an original $3.15 per share.

Yamana has received tenders for about 24 million shares, roughly 24% of Meridian’s outstanding shares. That would imply that about 10 million shares were withdrawn since Sept. 12, when Yamana extended the expiry of its earlier bid. This variation to the offer decreases the company’s acceptance criterion for the bid: Yamana, which had been seeking two-thirds of the outstanding shares of Meridian, will now accept the bid if 50.1% are tendered.

Yamana and Northern Orion Resources (NNO-T, NTO-X) have amended their merger plan to accommodate the new acceptance line. Shareholders of Northern Orion accepted a plan of arrangement in late August under which Northern Orion shareholders will receive 0.543 of a Yamana share plus 0.1 for one Northern Orion share, valuing Northern Orion at $6.90 per share or about $1.4 billion fully diluted.