Sept 2 (Reuters) - US Gold Corp said it had begun the process of taking over Minera Andes through an increased all-stock exchange offer, first proposed by US Gold CEO and the companies’ largest shareholder Rob McEwen.
Shares of Minera Andes jumped up 12 percent to C$2.58 in early trade on Friday on the Toronto Stock Exchange, while those of US Gold were up 3 percent at C$6.14.
Under the new exchange ratio, Minera shareholders will get 0.45 of a US Gold share for every Minera share they hold. The new ratio values Minera Andes at about C$759.5 million ($778.3 million).
In June, McEwen proposed that US Gold takeover Minera Andes at an exchange ratio of 0.45 US Gold share for every Minera share.
The boards of both the companies have agreed to the new ratio and a break-up fee of 3 percent of either company’s market capitalization. ($1 = 0.976 Canadian Dollars) (Reporting by Abhiram Nandakumar in Bangalore)