Alamos Gold Inc. (TSX:AGI) has dropped its hostile takeover offer for Vancouver’s Aurizon Mines Ltd. (TSX:ARZ), Alamos announced March 20.
The announcement followed Aurizon’s revelation earlier this month that U.S.-based Hecla Mining bid US$774 to buy Aurizon.
Alamos said that it would have to pay a $27.2 million break fee to Hecla Mining if its hostile takeover bid were successful.
“The Aurizon board, by adopting this unique type of break fee, has foreclosed the opportunity for Aurizon shareholders to tender to Alamos’ superior offer,” said Alamos CEO John McCluskey.
“In pursuing our growth objectives, we will not deviate from the fiscal discipline that has made us one of the world’s most successful gold companies, and the payment of this break fee in these circumstances would violate that discipline.”
Hecla’s offer, valued at $4.75 per Aurizon share (TSX:ARZ) when it was announced, is 10 cents more than the Alamos Gold bid, valued at $4.65 per share when it was announced.
Analysts have speculated that one of the main reasons that the U.S. silver miner wants to buy Aurizon is to gain control of a gold mine in Quebec.
