Kaminak Gold Corp. May 12 reported that Goldcorp Inc. has agreed to acquire the junior mining company in an all-share transaction.

The total consideration offered for the Kaminak shares is roughly C$520 million.

"This acquisition is consistent with our strategy of partnering with junior exploration companies to identify and develop mining districts with significant exploration potential that is expected to grow our net asset value per share," said Goldcorp President and CEO David Garofalo.

"Coffee is located within a politically stable jurisdiction and provides us with an opportunity to add high-quality ounces to our development pipeline at low all-in sustaining costs.

With our strong financial position and mine construction expertise, we see significant potential to deliver value for all partners and stakeholders." Under a definitive agreement, each common share of Kaminak will be exchanged for 0.10896 common shares of Goldcorp, which represents a value of C$2.62 per Kaminak share based upon Goldcorp's May 11 closing share price of C$24.08 on the Toronto Stock Exchange.

This represents a premium of 33 percent based on the closing prices of both companies' common shares that day.

"This transaction realizes many immediate benefits for our shareholders and at the same time ensures that the Coffee Gold project will be developed in a timely and responsible manner," said Kaminak President and CEO Eira Thomas.

"Coffee is a natural fit within their (Goldcorp's) portfolio and they have the experience, expertise and financial flexibility to build Coffee for the benefit of our First Nations partners and all Yukon stakeholders." Kaminak's directors unanimously recommend that shareholders vote in favor of the arrangement, and each director intends to vote all of the Kaminak shares they own or control in favor of the arrangement, in the absence of a superior proposal.

"In 10 short years, we have grown Kaminak from a small grassroots explorer to one of Canada's top gold development companies.

The discovery of the Coffee Gold Project has created value for our shareholders and its development will ultimately benefit our First Nations partners and all Yukoners," Kaminak Chairman John Robins said.

The arrangement is subject to, among other things, 66 2/3 percent Kaminak shareholder approval.

A special meeting of Kaminak shareholders and option holders is to be held no later than July 14.

Author Bio

Shane Lasley, Publisher

Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.

• Email: [email protected]
• Phone: (907) 726-1095
• https://www.linkedin.com/in/shane-lasley-ab073b12/