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Goldcorp to sell Los Filos Mine to Leagold

Thursday, January 12, 2017 8:33
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Goldcorp (TSE:G, NYSE: GG) is to sell its Los Filos Mine in Mexico to Leagold Mining Corporation, the company said on Thursday.

Under the terms of the Agreement, Goldcorp will receive estimated consideration of $438mln, consisting of $279mln in cash, $71mln in Leagold common shares, and retain certain tax receivables of approximately $88mln.

The common shares issued to Goldcorp as consideration are expected to represent approximately 30% of the issued and outstanding shares of Leagold following the closing of the deal.  

By closing of the transaction, Goldcorp expects to recognize a reversal of a 2015 impairment in mining interests at Los Filos of approximately $30 to $60mln on a pre-tax basis.

“The divestiture of Los Filos is consistent with our strategy of focusing on our core camps to drive increasing net asset value per share,” said David Garofalo, President and Chief Executive Officer of Goldcorp.

“We thank the team at Los Filos for their commitment and dedication and we wish them continued success as part of Leagold.  We will work closely with the team at site to ensure a smooth transition and look forward to working with Leagold to continue to add value at Los Filos.”

The deal is subject to customary closing conditions and is expected to close in the first quarter of 2017. Scotia Capital acted as financial advisor to Goldcorp.

Goldcorp shares were up 2.8% to $14.88 in New York on Thursday.

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