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The Gold Stock Strategist analyzes leading junior gold producers and major gold mining companies.

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Thursday, December 24, 2009

Goldcorp Matches Penmont Bid for Canplats

Yesterday, Canada-based Goldcorp Inc. ($GG) announced it had been notified by Canplats Resources Corp. ($CPQ.CA) ($CPQRF) that it received a $254 million buy-out offer from Minera Penmont that is higher than Goldcorp's earlier bid of $238 million.

Today, Goldcorp announced it has matched the competing proposal. Under the terms of Goldcorp's matching proposal, Canplats is required to enter into an agreement with Goldcorp to reflect the amendments and recommend Canplats shareholders approve the buyout by Goldcorp. Under the terms of the Penmont proposal, because Goldcorp has exercised its right to match Penmont, the proposal is no longer in effect. No fees are payable by Canplats to Penmont.

If Goldcorp had not matched or outbid Penmont, Canplats would owe Goldcorp a contractual termination payment of $7.2 million.

Penmont is jointly owned by Fresnillo PLC and Newmont Mining Corp. ($NEM). The company offered $4.20 cash and shares in a new exploration company worth 20 cents per share for every Canplats share.

Canplats' main focus is the development of the Camino Rojo discovery in Mexico. The Represa deposit at Camino Rojo has 3.4 million ounces of gold and 61 million ounces of silver on a measured and indicated resources basis.

Penmont is owned 56 percent by Mexico-based Fresnillo Plc, and 44 percent by Newmont. Fresnillo is Mexico's second largest gold producer and the world's largest primary silver producer. Newmont is the world's second largest gold producers.

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