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Detour Gold Corp DRGDF



GREY:DRGDF - Post by User

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Comment by cheechwuzupon Jul 31, 2008 9:34am
207 Views
Post# 15346883

RE: Goldgorp buys Gold Eagle

RE: Goldgorp buys Gold EagleUPDATE 1-Goldcorp to buy Gold Eagle, reports surprise loss
16 minutes ago - Reuters

(Adds details. In U.S. dollars)

TORONTO, July 31 (Reuters) - Goldcorp G.TO said on Thursday it planned to acquire fellow Canadian gold miner Gold Eagle Mines GEA.TO for about C$1.5 billion ($1.47 billion) to pick up the Bruce Channel gold discovery, which lies close to Goldcorp's flagship Red Lake operation.

Goldcorp, Canada's No. 2 gold producer, also reported an unexpected second-quarter loss, hurt by a non-cash foreign exchange loss on future income tax liabilities, and cut its production outlook for the year.

Under the friendly deal, Gold Eagle shareholders will receive C$6.80 in cash and 0.146 shares of Goldcorp for each share. Goldcorp already owns 4.7 percent of Gold Eagle.

The offer values each Gold Eagle share at C$12.62, a 19 percent premium, based on Wednesday's closing prices. Gold Eagle's board has approved the transaction, the companies said.

Goldcorp, which has operations in Canada and throughout Latin America, lost $9.2 million, or 1 cent a share, in the quarter ended June 30. That compares with a profit of $2.9 million, or nil a share, in the year-before period.

Adjusted earnings were 12 cents a share, while analysts had expected a profit of 22 cents a share, before exceptional items.

Cash margins increased 18 percent to $589 per ounce, as gold prices soared year over year.

However, the company cut its 2008 production outlook and raised its cash cost estimate.

It now expects to produce between 2.3 million and 2.4 million ounces, down from its previous expectation of 2.6 million ounces. Costs are expected at less than $300 an ounce, up from its previous estimate of $250 an ounce. ($1=$1.02 Canadian) (Reporting by Cameron French; Editing by Scott Anderson)

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