Goldcorp’s $3.2-bn bid for Andean Resources trumps Eldorado Gold’ offer

Goldcorp Inc, Canada's largest gold producer, yesterday agreed to buy gold miner Andean Resources Ltd for C$3.6 billion ($3.2 billion), trumping a rival bid from Eldorado Gold Corporation.

As global gold producers try to consolidate with gold prices reaching record prices, the takeover comes soon after Australia's Newcrest Mining finalised a deal on 23 August to buy rival Lihir Gold for $8.4 billion. (See: Lihir Gold shareholders approve $22.3 billion merger with Newcrest Mining)

Goldcorp offered Andean C$6.50 a share, a 35 per cent premium to Andean's last traded price on the Toronto exchange, or 2 per cent more than Eldorado's offer.

Eldorado had offered 0.310 a share for every one of Andean's, valuing each at C$6.36. Goldcorp's offer was made just hours after the board of Andean rejected Eldorado's bid.

Vancouver-based Eldorado, Canada's fifth-biggest gold producer, had yesterday made a bid of 0.310 a share for the Sydney and Toronto listed Andean, after the Perth-based miner had rejected its informal approach last month.

Eldorado had said in its proposal that the merger would create ''the world's fastest growing'' and ''lowest cost'' gold producer.