Vancouver's Goldcorp Inc. (TSX:G) plans to acquire Toronto-based Gold Eagle Mines Ltd. (TSX:GEA) in a deal worth $1.5 billion.
The friendly takeover will consolidate ownership of the Red Lake district in northwestern Ontario. Gold Eagle's principal asset is the Bruce Channel gold discovery, adjacent to Goldcorp's Red Lake gold mine and southwest of Goldcorp's Cochenour-Willans mine.
Under the plan of arrangement, each Gold Eagle share will be exchanged for either a cash payment of $13.60 per share, 0.292 Goldcorp share per Gold Eagle share or a combination of the two.
The deal represents a 36% premium to the 20-day volume-weighted average price of the company. It's expected to close in September 2008, subject to customary shareholder and regulatory approvals.
Goldcorp's share price range during the past week: between $39.85 and $41.97; 52-week high: $52.48; 52-week low: $22.40.