UPDATE 2-Silver Wheaton stock falls on tax audit; top investor backs company
(Adds comments from CEO, shareholder, competitor)
By Nicole Mordant
VANCOUVER, July 7 (Reuters) - Shares of Silver Wheaton Corp fell more than 10 percent on Tuesday after the mining finance company said it might have to pay $200 million or more in taxes and penalties in Canada.
Vancouver-based Silver Wheaton said late on Monday it had received a letter from the Canada Revenue Agency, which is proposing taxing about C$715 million ($565 million) of income earned by the company's foreign units between 2005 and 2010.
With a market value of around $7 billion, Silver Wheaton is the world's biggest mining "streaming" company. It pioneered streaming, which involves providing financing to miners for the right to buy a percentage of their future metal production.
Silver Wheaton will "vigorously defend" its tax filing position and remains confident in its business structure, Chief Executive Officer Randy Smallwood said on a conference call.
The market has been waiting for more than three years for word from the revenue agency on its audit, which Silver Wheaton disclosed in April 2012.
Van Eck Associates Corp, which with a stake of around 4.55 percent is Silver Wheaton's biggest shareholder, believes a court would back Silver Wheaton's tax position, portfolio manager Joseph Forster said.
"It's a fantastic company, and it's probably the best way to gain exposure to silver," Foster said in an interview. "We're standing behind the company 100 percent." Continued...