Goldcorp, Glamis trade shots

Announcements from both Goldcorp (G-T) and Glamis Gold (GLG-T) make it look like the takeover battle surrounding Goldcorp may turn into a cutting contest along the lines of Gold Fields (GFI-N) versus Harmony Gold Mining (HMY-N).

Goldcorp scheduled and then cancelled a conference call along with Wheaton River Minerals (WRM-T) on their proposed merger and Glamis’s competing takeover bid for Goldcorp. In a release, the company said the Goldcorp board’s Special Committee would be reviewing the Glamis offer to see if, contrary to the committee’s earlier opinion, the offer was different from an earlier offer Glamis had made to the Goldcorp board.

The board continues to recommend the merger with Wheaton, which offers one Goldcorp share for four Wheaton and would create a company owned 52% by Goldcorp shareholders. Goldcorp has scheduled a meeting on Jan. 31 to seek shareholders’ approval of its bid for Wheaton.

Goldcorp recommended its shareholders await the board’s opinion on the Glamis bid, which offers 0.89 of a Glamis share for one share of Goldcorp.

Glamis’s president Kevin MacArthur, in a prepared statement commenting on Goldcorp’s appointment of investment house Bear Sterns as a financial advisor (joining GMP Securities) said “the hiring of a third investment bank is yet another needless waste of Goldcorp shareholders’ money.” MacArthur was referring to N.M. Rothschild & Sons, which had been replaced by GMP after delivering an earlier fairness opinion on the negotiated deal between Glamis and Goldcorp.

For Glamis, the principal selling point of the offer to Goldcorp shareholders is that Glamis pays a takeover premium for Goldcorp shares, whereas Goldcorp is paying a premium in its takeover offer for Wheaton.

Goldcorp management also distanced itself from chairman Robert McEwen, saying “Mr. McEwen’s statements to date have been in his personal capacity, as a large shareholder, and not as a Director or Chief Executive Officer of Goldcorp.”

Goldcorp management may have been alluding to comments McEwen made to an analysts’ briefing in Toronto on Jan. 13, where he was quoted as saying he would be “the first one out the door” if the Glamis offer was successful. McEwen directly owns about 6.4 million shares of Goldcorp and another 2.5 million options, which — assuming all the options were converted — would give him 8.9 million Goldcorp shares, tradable for 7.9 million Glamis shares, or about a 2.5% shareholding in Glamis.

McEwen was quoted as having criticized the relatively low earnings of Glamis in comparison to Goldcorp and the dilution of ownership Glamis was accepting to make the takeover deal. (A merged Glamis and Goldcorp would be owned 58% by Goldcorp shareholders.)

Glamis’s offer has no fixed expiry date yet, but the company has scheduled a shareholders’ meeting to seek approval of the offer to Goldcorp on Feb. 9.