Goldcorp and Glamis see $25 million a year in synergies after merger: Knowledge Driven Revolution

VANCOUVER (CP) - Goldcorp Inc. (TSX:G) and Glamis Gold (TSX:GLG) will focus on growth in the Americas and hope to find $25 million in annual synergies in their merger that will create Canada's newest senior gold miner, the companies said Thursday.

"The things I like the most are the management and people synergies that we'll be putting into place, putting teams together to outperform," Kevin McArthur, president and chief executive of Glamis, told a conference call with analysts.

"You can't put a number on those, but those are the things that we look most forward to."

Under the deal announced early Thursday morning, Glamis shareholders will receive 1.69 shares of Goldcorp for each Glamis share.

Glamis shares rose on news of the all-stock deal, which values that company at about $8.7 billion based on Thursday stock prices, adding $8.18 or about 20 per cent to $51.20.

However Goldcorp shareholders sold off their stock sending it down $3.24 or almost 10 per cent to $30.53 on the Toronto Stock Exchange amid concerns the deal would not be immediately accretive to earnings and stock dilution.

Goldcorp CEO Ian Telfer will become chairman of the new Goldcorp, while McArthur will become president and chief executive officer of the newly combined company, which will be based in Vancouver.

Telfer said he will remain "intensely involved" with the company on things like strategy, acquisitions, negotiations and promotion.

"The difference is we will have Kevin, who's background is technical, full-time focused on the operations," Telfer said of McArthur.

Last year, Goldcorp bulked up with the takeover of Wheaton River Minerals Ltd. and the $1.5-billion-US addition of several former Placer Dome mines earlier this year.

$1.5-billion-US addition of several former Placer Dome mines earlier this year.

Goldcorp has operations in Canada, Argentina, Mexico, Brazil, Australia and the United States, and also owns a controlling interest in Silver Wheaton Corp. (TSX:SLW).

Meanwhile, Glamis operates mines and development projects in Nevada, Mexico and Central America.

The new company will have proven and probable reserves of about 41.1 million ounces of gold with focused operations in the Americas and 11,000 employees.

Glamis shareholders will end up holding about 40 per cent of the new company that will have a board of directors including six from the board of Goldcorp and four from the board of Glamis.

The deal, supported by the boards of both companies, requires approval by two-thirds of Glamis shareholders. A vote by Goldcorp shareholders is not required.

Glamis has agreed to pay a break fee to Goldcorp of $215 million US if the deal is not completed under certain circumstances. Glamis has also provided Goldcorp with a right to match competing offers.

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HOME V for Vendetta - R for Reality Canadian Bird Flu Pandemic Looming ? Shill of the Week: Stephan Harper Aspartame: The Sweetest Killer Chicken Little Terrorist of the Week: Creating Fake Terrorists Shill of the Week: Paul Martin The Number 1 Reason YOU became a Slave	Goldcorp and Glamis see $25 million a year in synergies after merger CRAIG WONG - CP September 01, 2006 VANCOUVER (CP) - Goldcorp Inc. (TSX:G) and Glamis Gold (TSX:GLG) will focus on growth in the Americas and hope to find $25 million in annual synergies in their merger that will create Canada's newest senior gold miner, the companies said Thursday. "The things I like the most are the management and people synergies that we'll be putting into place, putting teams together to outperform," Kevin McArthur, president and chief executive of Glamis, told a conference call with analysts. "You can't put a number on those, but those are the things that we look most forward to." Under the deal announced early Thursday morning, Glamis shareholders will receive 1.69 shares of Goldcorp for each Glamis share. Glamis shares rose on news of the all-stock deal, which values that company at about $8.7 billion based on Thursday stock prices, adding $8.18 or about 20 per cent to $51.20. However Goldcorp shareholders sold off their stock sending it down $3.24 or almost 10 per cent to $30.53 on the Toronto Stock Exchange amid concerns the deal would not be immediately accretive to earnings and stock dilution. Goldcorp CEO Ian Telfer will become chairman of the new Goldcorp, while McArthur will become president and chief executive officer of the newly combined company, which will be based in Vancouver. Telfer said he will remain "intensely involved" with the company on things like strategy, acquisitions, negotiations and promotion. "The difference is we will have Kevin, who's background is technical, full-time focused on the operations," Telfer said of McArthur. Last year, Goldcorp bulked up with the takeover of Wheaton River Minerals Ltd. and the $1.5-billion-US addition of several former Placer Dome mines earlier this year. $1.5-billion-US addition of several former Placer Dome mines earlier this year. Goldcorp has operations in Canada, Argentina, Mexico, Brazil, Australia and the United States, and also owns a controlling interest in Silver Wheaton Corp. (TSX:SLW). Meanwhile, Glamis operates mines and development projects in Nevada, Mexico and Central America. The new company will have proven and probable reserves of about 41.1 million ounces of gold with focused operations in the Americas and 11,000 employees. Glamis shareholders will end up holding about 40 per cent of the new company that will have a board of directors including six from the board of Goldcorp and four from the board of Glamis. The deal, supported by the boards of both companies, requires approval by two-thirds of Glamis shareholders. A vote by Goldcorp shareholders is not required. Glamis has agreed to pay a break fee to Goldcorp of $215 million US if the deal is not completed under certain circumstances. Glamis has also provided Goldcorp with a right to match competing offers. Read the full article here Broken Link? If the link to the original article is broken or has been altered you can view the article by clicking here. About KDR \| \| Home \| \| Weekly Features Archive	Weekly Features Archive
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