High prices for precious metals are highlighting a wave of acquisition activity in Vancouver’s mining community with three companies showing their hands on Monday.
With gold hovering at all-time highs of about US$1,300 per ounce Timmins Gold Corp. (TSX-V:TMM) publicly revealed its unsolicited $275 million takeover bid for New York-based Capital Gold Corp. (TSX:CGC).
Timmins’ proposed merger with Capital Gold would result in the consolidation of two similarly-sized companies into a single mid-tier gold producer focused on Mexico.
Timmins originally made its offer to Capital Gold’s board on August 31 but the proposal did not result in what Timmins CEO Bruce Bragagnolo called “meaningful dialogue.” So, he decided to go directly to Capital’s shareholders.
While the market digested the news, two other Vancouver-based small cap precious-metal miners announced acquisition plans.
Those moves come at time when silver is near a 30-year high, hitting US$21.47 per ounce on Monday.
Bank of America Merrill Lynch raised its medium-term price target for silver to $25 an ounce on Monday. It expects silver prices to rise gradually, largely due to investment, rather than industrial, demand.
The two deals were: