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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."
Kirkland Lake and Newmarket shareholders are due to vote on their combination on Nov. 25. At least two-thirds of Kirkland Lake shareholders and half of Newmarket's need to back the transaction for it to succeed.
Investor advisory firms ISS and Glass Lewis have recommended to shareholders of Kirkland Lake and Newmarket that they vote for the deal. Their recommendations came out before Reuters revealed the value of the Kirkland Lake bid and the identity of the bidders.
A Glass Lewis spokesman said on Monday it was not planning to change its position now but would monitor the situation and could update it prior to the Nov. 25 meeting "if the situation warrants".
In a note to clients, Scotiabank said it saw "a low likelihood" the Kirkland Lake-Newmarket deal has enough shareholder backing.
Shares in Kirkland Lake, a mid-sized producer operating four gold mines and two mills in a bullion-rich belt of northeastern Ontario, ended at C$8.49, up 5.6 percent, after having touched C$8.83. Newmarket shares ended 3.9 percent higher at C$3.49.
Reporting by Nicole Mordant in Vancouver and John Tilak in Toronto; Editing by Meredith Mazzilli and James Dalgleish