NEW YORK (TheStreet) -- A day after announcing it would make a hostile bid for Osisko Mining, Goldcorp (GG) has made its intentions official. On Tuesday, the gold producer confirmed it had commenced its formal offer to acquire Osisko Mining Corporation by filing required documents with Canadian securities regulators and the U.S. Securities and Exchange Commission.
Goldcorp intends to purchase all outstanding common shares in a cash-and-shares deal worth C$2.6 billion. As part of the offer, Osisko shareholders will receive 0.146 of a Goldcorp share and C$2.26 in cash per holding. The offer to Osisko shareholders is equal to approximately $5.95 a share, 28% higher than the company's 20-day volume-weighted average share price.
The Vancouver-based Goldcorp said the unsolicited offer was in line with its strategy of portfolio enhancement, particularly its focus on investing in low political risk jurisdictions. Of particular interest is the acquisition of the Abitibi mining district in Quebec, a proven high-quality operation.
"Goldcorp shareholders will benefit from a long-lived, high-quality gold mine with low all-in sustaining costs capable of generating long-term free cash flows," said Goldcorp CEO Chuck Jeannes in a statement on Monday. "With our world-class Eleonore project in Northern Quebec due to commence production later this year, Goldcorp will be the largest gold producer in the province with the resources to continue building collaborative, long-term relationships while leveraging corporate and regional synergies."
In an SEC filing, Goldcorp said Osisko has refused to entertain merger or acquisition talks over the last five years.
"The Offeror has made repeated and genuine attempts to discuss a mutually beneficial transaction with Osisko. Osisko has continually refused to either negotiate or engage in meaningful dialogue, leading to the current circumstances where the Offeror believes the Offer made by this Offer and Circular is the only way to deliver the expected benefits of a transaction to all Osisko Shareholders," the company said in the filing.