Nevada's Meridian Gold Inc. (TSX:MNG) has approved a sweetened acquisition offer from Toronto-based Yamana Gold Inc. (TSX:YRI). The approval paves the way for completion of the companies' merger with Vancouver's Northern Orion Resources Inc. (TSX:NNO).
Yamana has agreed to pay $7 per share plus 2.235 Yamana shares for each Merdian share. The deal increases the cash component by $0.50 over the $6.50 offered last Thursday.
Yamana has also agreed to extend the offer to October 12 from October 2.
The revised deal would represent a 38% premium over Meridian's average share price during the past 20 trading days.
Yamana's $6.50 cash component had itself been increased $2.50 over the offer made in mid-August. Meridian had claimed that Yamana's offer did not represent the full value of Meridian.
The deal clears the way for Yamana's merger with Northern Orion, whose shareholders approved the merger with in late-August subject to the successful takeover of Meridian.
The merger will create a mid-tier gold producer with estimated annual gold production of more than 1.4 million ounces by 2009.
Northern Orion's share price range during the past week: between $5.98 and $6.57; 52-week high: $6.80; 52-week low: $3.85.