September 7, 2010 / 6:56 PM / in 7 years

UPDATE 1-Eldorado withdraws bid for Andean Resources

* Says Andean’s Cerro Negro not a ‘need to have asset”

* Says its shareholders concerned about bidding war

TORONTO, Sept 7 (Reuters) - Eldorado Gold Corp (ELD.TO) said on Tuesday it would abandon its proposal to acquire Argentina-focused Andean Resources AND.AX in light of Goldcorp’s (G.TO) higher offer worth C$3.6 billion ($3.43 billion).

Goldcorp and Eldorado were both vying for Andean’s 100 percent owned Cerro Negro Gold project in the southern province of Santa Cruz in Argentina.

“In our opinion, our proposal reflected full value for Cerro Negro and from an Eldorado perspective, Cerro Negro is a ‘good to have’ asset, not a ‘need to have asset,'” said Eldorado in a statement.

Goldcorp’s cash and share offer of C$6.50 per share, which topped Eldorado’s all-share bid worth C$6.36 a share, has won the unanimous approval of the boards of directors of both companies. [ID:nSGE6820BF]

Eldorado said its shareholders were concerned about the company entering into a “value-destroying auction” process.

“The gold industry, as a whole, has an appalling track record of value destruction, and Eldorado has no intention of following in these unfortunate footsteps,” said the company. ($1=$1.05 Canadian) (Reporting by Euan Rocha; Editing by Frank McGurty)

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