Canadian-based Yamana Gold confirmed on November 4 that it received an “unsolicited binding proposal” from Agnico Eagle Mines and Pan American Silver that was superior to a previous takeover bid from South African miner Gold Fields.
The joint cash and stock offer from Agnico Eagle and Pan American valued Yamana at around $4.8 billion, while the Gold Fields all-stock deal valued Yamana at around $4.2 billion at November 3’s close. When the Gold Fields deal was first announced in May it valued the Canadian miner at $6.7 billion. However, Gold Fields shares have plummeted 20% since then, said Reuters, denting its appeal to Yamana shareholders.
The new joint offer has Pan American acquiring all of the issued and outstanding common shares of Yamana and the sale of certain Yamana subsidiaries and partnerships, including the Canadian Malartic mine, to Agnico, all by way of a proposed plan of arrangement.
The Agnico/Pan American offer would only become effective if Yamana shareholders vote against Gold Fields’ offer on November 21. In that scenario, Yamana would have to pay Gold Fields a $300 million break fee.
The board of Gold Fields said on November 7 that it will not change its offer after the surprise rival bid. Its decision reflects “commitment to capital discipline” and to fairness for shareholders in Gold Fields and Yamana Gold.
Yamana Gold has significant gold and silver production, development stage properties, exploration properties, and land positions throughout the Americas, including Canada, Brazil, Chile and Argentina.