The resource space is seeing further consolidation, with Canadian gold miner Goldcorp Inc. (GG,G.TO) announcing Friday an agreement to buy Australian miner Andean Resources Limited (AND.TO) for a total consideration of approximately C$3.6 billion or about US$3.42 billion in cash and stock.
Goldcorp's offer beats an earlier all stock C$3.4 billion-bid by Canadian miner Eldorado Gold Corp. (EGO,ELD.TO), as players scramble to take advantage of low valuations and higher gold prices. The precious metal has been seeing notable strength of late due to its status as a safe haven amid uncertain economic times. Goldcorp expects the transaction to close in late 2010 or early 2011.
Goldcorp noted that under the scheme of arrangement under the Australian law, each Andean share will be exchanged for 0.14 common shares of Goldcorp or a cash payment in the amount of C$6.50, subject to an aggregate maximum cash consideration of C$1 billion.
Thursday, Eldorado offered 0.31 Eldorado share for each Andean ordinary share, valuing Andean at C$6.36 a share.
Goldcorp noted that its transaction represents a 35% premium to Andean's TSX closing price on September 2, based on Goldcorp's TSX stock price on the same date. The deal also represents a 56% premium to Andean's 20 day volume weighted average trading price on the TSX.
Subject to the aggregate cash limitation, the shareholders of Andean could elect to receive cash or shares or any combination of cash and shares. Those who does not elect either option would receive Goldcorp shares.
The acquisition, which has been unanimously approved by the boards of directors of both companies, will be subject, among other things, to the favorable vote of 75% of Andean shares and the affirmative vote of more than 50% of holders of Andean shares.
The company noted that Andean's largest shareholder Sentient Executive GP II and its related entities, who hold about 21% of Andean's shares, have stated their intention to vote in favor of the deal. In addition, Sentient has agreed to a call option agreement with Goldcorp in relation to up to 107.91 million Andean shares representing up to 19.9% of Andean shares, in order to support the transaction.
Andean's principal asset is the 100%-owned Cerro Negro gold project located in the Santa Cruz province of Argentina. Cerro Negro currently has reported indicated resources of 2.54 million ounces of gold and 23.56 million ounces of silver. Inferred resources total 523,000 ounces of gold and 3.12 million ounces of silver.
Andean has agreed to pay Goldcorp a termination fee equal to 1% of the total consideration, under certain circumstances.
In the deal, Goldcorp's financial advisor is CIBC World Markets, and Andean's financial advisor is BMO Capital Markets.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.