Canada’s Goldcorp Inc. (TSX:G.TO – News) said on Thursday it will acquire U.S.-based Glamis Gold Ltd. for about US$8.6 billion in stock, a deal that will push it firmly into the ranks of senior producers.
Glamis’s shareholders will receive 1.69 Goldcorp shares for each share of Glamis, representing a value of $51.49 per share based on Goldcorp’s August 30 closing price. That’s a premium of 32.7 percent to Glamis’ closing price.
The news sent shares of Glamis up 20 percent to $46.47 on the New York Stock Exchange. Goldcorp stock was down 8.6 percent at $27.85.
It would be much better performance-wise if we were only picking the acquiree, not the acquiror as well. But since the portfolio was equal-weighted the 20% gain in Glamis trumps the decline in Goldcorp. So we’ll take it.Like this article? Why not try out: