TORONTO/VANCOUVER (Reuters) - Goldcorp Inc (G.TO) would rather walk away from its hostile bid for Osisko Mining Corp (OSK.TO) than pay too much for its fellow Canadian gold miner, Goldcorp Chairman Ian Telfer said on Tuesday, although he did not rule out raising the bid.
Goldcorp, the world's second biggest gold producer by market value, has several other growth opportunities, including the opening of two mines this year, and is doing "extremely well," Telfer said.
"It is much worse for us to overpay for an asset than it is to let it go," Telfer said in an interview.
"We are very focused on being disciplined and bringing down the crossbar. Somebody has to do it after all the high prices that were paid in the past," he said.
Vancouver-based Goldcorp in January launched a C$2.8 billion ($2.5 billion) cash and stock bid for Osisko to gain control of its Malartic gold mine in the province of Quebec. It is the gold-mining industry's biggest takeover bid for months after deals dried up following the writedown by Goldcorp's peers on billions of dollars of assets bought at sky-high prices as the bullion price ran up.
Osisko rejected Goldcorp's bid as too low, and has been building a case that its shareholders stand to benefit the most if it remains a standalone company.
Osisko's Chief Executive Officer Sean Roosen has said that he is confident that Goldcorp's current bid will fail to win over the majority of Osisko's shareholders.
Telfer disagreed although he pointed out that most of Goldcorp's major shareholders are also shareholders of Osisko, meaning investors end up wearing "two hats."
"With one hat on, they've been very vocal in telling the gold mining industry not to overpay for acquisitions. And we've been listening to them and we think that is the new reality," Telfer said.
"With their other hat on, they own Osisko, they want to talk a little about valuation," he said.
Osisko has also said it is continuing to aggressively pursue a range of "value-maximizing" alternatives to Goldcorp's bid although Telfer questioned whether such a "white knight" was in the wings. Osisko's share price has consistently traded above Goldcorp's bid, indicating that shareholders expect a higher offer to emerge.
Osisko shareholders have until April 4 to tender their shares to Goldcorp's offer.
"They've had 11 weeks to bring in a bidder. They have one week left. We haven't seen the bidder yet. No one has seen the bidder yet," Telfer said.
Without another bid, there is little reason for Goldcorp to raise its offer. "We don't see any reason to bid against ourselves," he added.
However, asked if the Osisko bid currently on the table was Goldcorp's final offer, Telfer said it would depend on what the company's due diligence into Osisko, which will start on April 1, reveals.
"We are always open-minded," he said.
($1 = 1.1176 Canadian dollars)
Editing by G Crosse