Agnico Eagle Mines and Pan American Silver have agreed to acquire Canada’s Yamana Gold, in a $4.8bn cash-and-shares transaction.
The arrangement agreement has been signed by Yamana with the two precious metals miners after Gold Fields waived its right-to-match.
Last week, Yamana Gold received a joint unsolicited takeover offer from Agnico Eagle Mines and Pan American Silver, valuing Yamana Gold at $5.02 per share.
The offer comprises 153.5 million Pan American Silver shares, 36.1 million Agnico Eagle shares and $1bn in cash.
Pan American offered to acquire all of Yamana Gold’s issued and outstanding common shares.
Yamana Gold would offload certain subsidiaries and partnerships that own stakes in its assets in Canada to Agnico Eagle.
Subsequently, Yamana Gold’s board has determined the latest joint offer to be superior and informed that Gold Fields holds the option to improve its existing offer in five business days.
According to the all-stock deal signed in May 2022, Gold Fields agreed to acquire Yamana Gold for $5bn (C$6.5bn).
However, there was a subsequent 20% drop in Gold Fields’ share price after the deal announcement and weaker gold prices, thereby affecting the appeal for Yamana shareholders, reported Reuters.
The cash component in the Agnico/Pan American bid gives their deal an edge over Gold Fields as it is not linked to any gold price, according to the news agency’s report.
At the Yamana shareholders’ meeting scheduled on 21 November 2022, the Yamana board plans to recommend its shareholders vote against Gold Fields’ takeover offer.
Under the agreement, Gold Fields will receive a $300m termination fee from Yamana within two business days from the date of termination.
Gold Fields said in a statement: “Gold Fields is disappointed by this outcome, and continues to believe that the Transaction was a financially and strategically superior offer for shareholders of both Gold Fields and Yamana.
“Nonetheless, following Yamana’s change in recommendation, Gold Fields believes the most disciplined and prudent course of action to maximise Gold Fields’ shareholder value is to terminate the arrangement agreement. Gold Fields and its shareholders will now benefit from the termination fee.”