Gold miner Kirkland Lake rises on bid talk; Yamana declines

Mon Nov 14, 2016 5:23pm EST
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VANCOUVER (Reuters) - Kirkland Lake Gold shares rose sharply on Monday on speculation there might be another bid for the Canadian gold miner which has rejected three offers, but at least one potential buyer said it would not jump into the fray.

Kirkland's stock climbed as much as 9 percent, partly boosted as well by the possibility that its planned takeover of Newmarket Gold Inc, which had put its stock under pressure, will be voted down.

Reuters reported on Friday that South Africa's Gold Fields Ltd and Canada's Silver Standard Resources Inc have made three joint bids for Kirkland Lake and recently sweetened their offer to about C$1.4 billion ($1 billion).

Both Kirkland Lake and Gold Fields later confirmed the report.

Kirkland has rejected all three bids, saying they are "not financially superior" to its own plan to acquire Newmarket, a small Australia-focused miner, for about C$1 billion in stock.

Three sources familiar with the bidding process told Reuters last week it is possible new bidders may enter the fray, noting companies such as Yamana Gold Inc and Hecla Mining Co have assets in the area where Kirkland Lake operates.

A Yamana spokeswoman said it has no interest in making a bid. Hecla did not immediately respond to a request for comment.

Kirkland Lake said in a statement on Monday that the majority of shareholders it had spoken with believed its planned acquisition of Newmarket "represents a clear and compelling opportunity to create sustained, long-term value."   Continued...

A driller extracts a drill core at an exploration site located north west of Kirkland Lake, Ontario, October  3, 2011. REUTERS/Euan Rocha