Osisko drops lawsuit in takeover battle, Goldcorp offer extended to April 15
MONTREAL - Osisko Mining Corp. (TSX:OSK) said Monday it has settled a lawsuit it filed against Goldcorp Inc. (TSX:G) as part of the Montreal-based company's fight against a hostile takeover by the senior gold miner.
Under the settlement, the offer from Vancouver-based Goldcorp has been extended to April 15, from March 10, while Osisko continues its search for an alternative bid.
Osisko has also agreed to waive its shareholder rights plan by April 14 and provide Goldcorp with access to due diligence materials starting April 1, or earlier if Osisko signs a deal with another bidder.
"Given the robustness of our process to pursue value maximizing alternatives, the extension to April 15, 2014 provides a meaningful extension to the anticipated time to complete this work," Osisko president and chief executive Sean Roosen.
"The April 15, 2014 date also provides certainty of timing for those in the process to complete their work and propose executable arrangements to unlock value for all stakeholders."
Osisko has urged its shareholders to reject the Goldcorp offer and called it inadequate and opportunistic.
Goldcorp said it was pleased the lawsuit, in which Osisko had accused it of breaking a confidentiality agreement and failing to honour a standstill agreement, was over.
"This agreement will avoid the possibility of further delays in the completion of our offer that could have arisen from appeals of the pending litigation and the operation of Osisko's shareholder rights plan," Goldcorp president and chief executive Chuck Jeannes said.
Under terms of the Goldcorp bid, Osisko shareholders would receive 0.146 of a Goldcorp share and $2.26 in cash per Osisko share.
The price of gold and share prices for many gold producers have risen in recent weeks but Osisko shares have traded well above the implied value of the Goldcorp offer since the bid was first announced.
Osisko's shares closed up 45 cents at $7.50 on the Toronto Stock Exchange on Monday after trading for as much as $7.54.
Goldcorp shares closed up 55 cents at $30.32, making the implied value of its offer about $6.69 per share.
Osisko's main asset is the Canadian Malartic gold mine in northern Quebec where it has been ramping up operations since its first commercial production in May 2011.
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