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Goldcorp (GG) Inks Deal to Acquire Remaining Exeter Shares

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Goldcorp Inc. has entered into an agreement with Exeter Resource Corporation to acquire all the common shares of the latter, not already owned by the company, through a planned arrangement under section 288 of the Business Corporations Act.    

Per the arrangement, Goldcorp will acquire all the shares of Exeter it did not purchase under its previously announced offer on Apr 20, subject to the approval of Exeter shareholders. This subsequent acquisition transaction proposed by the company has been extended till Jun 7.

As communicated earlier,  Goldcorp acquired 77,428,836 Exeter Shares in exchange for 0.12 of a common share of Goldcorp for each Exeter common share, which being the same consideration payable under the arrangement. Goldcorp presently owns about 78,043,584 Exeter Shares, representing roughly 83.2% of the issued and outstanding Exeter Shares.

The completion of the transaction is subject to certain customary conditions, including all necessary stock exchange and court approvals.

Goldcorp’s shares have lost around 10.4% in the last three months, underperforming the Zacks categorized Mining–Gold industry’s 1.9% decline.


 

Goldcorp, in Apr 2017, announced that it expects 2017 gold production around 2.5 million ounces (+/- 5%), which remains unchanged from the previous guidance. The company expects all in sustaining costs (AISC) to be roughly $850 per ounce (+/- 5%), while total cash costs on a by-product basis are anticipated to be $500 per ounce (+/- 5%).

The company expects sustaining capital expenditures around $700 million (+/- 5%) and expansionary capital of roughly $600 million, which will be spent on Musselwhite's Materials Handling Project, Penasquito's Pyrite Leach Project, Coffee, Borden, NuevaUnion and Cochenour.

Goldcorp remains focused on execution, cost reduction and optimization of asset portfolio. The company, earlier this month, completed the transactions to form a 50/50 joint venture (JV) with Barrick Gold , for gold projects in the Maricunga District in Chile. Per the terms of JV, both Goldcorp and Barrick will jointly control over 20,000 hectares of mining properties in Maricunga District with the Caspiche and Cerro Casale deposits.

The JV allows both companies to jointly advance the Caspiche and Cerro Casale gold deposits, by consolidating infrastructure. It will also help both companies to reduce operating costs and capital. The JV will also reduce environmental footprint and improve returns, versus two standalone projects.

Goldcorp Inc. Price and Consensus

 

Goldcorp Inc. Price and Consensus | Goldcorp Inc. Quote

Goldcorp currently carries a Zacks Rank #3 (Hold).

Stocks to Consider

Some better-ranked companies in the basic materials space include The Sherwin-Williams Company (SHW - Free Report) and The Chemours Company (CC - Free Report) . Both the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.

Sherwin-Williams has expected long-term earnings growth rate of 11.4%.

Chemours has expected long-term earnings growth rate of 15.5%.

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