(Adds comments from analysts, background on buyer, recent sale
of Goldcorp project, updates stock price. All amounts in U.S.
dollars unless specified)
By Susan Taylor
TORONTO Jan 12 Goldcorp Inc agreed to
sell its Los Filos mine in Mexico to Leagold Mining Corp
in a deal valued at $438 million on Thursday, as the
world's No. 3 gold miner by market value focuses more squarely
on core assets.
Goldcorp, which put Los Filos on the block last year under a
push to prioritize its biggest and best mines, said the
transaction will help it grow net asset value per share and is
expected to close in the first quarter of 2017.
Under the transaction, Vancouver-based Goldcorp will get
$279 million in cash, $71 million in Leagold shares and tax
receivables worth about $88 million.
Shares of Goldcorp, which separately announced the $18
million cash sale of its Cerro Blanco project in Guatemala to
Bluestone Resources on Wednesday, nudged about 1 percent
higher on Toronto and New York exchanges at mid-session
RBC Capital Markets analyst Stephen Walker said the sale
price broadly matched his net asset value estimate of $462
million in a note to clients.
Los Filos has just a little over two years of reserves left,
but Leagold appears to be interested in its underground mining
potential, said Desjardins Securities analyst Michael Parkin.
Leagold said its executives, who developed Endeavour Mining
into a west African bullion producer, want to replicate
that buy and build strategy in Latin America.
Leagold Chief Executive Officer Neil Woodyer was Endeavour's
founder and company chairman, Frank Giustra, is an established
Canadian mining financier. They hold about 20.4 percent and 9.2
percent of Leagold shares respectively.
Last February, Goldcorp cut Los Filos' gold reserves by 78
percent, or 5.3 million ounces, because production had become
unprofitable at lower gold prices.
It operated Los Filos with a smaller pit, lower stripping
costs and shorter mine life plan in 2016 and, in the third
quarter, began shifting mining from open pits to underground
As of June 30, 2016, Los Filos had 1.43 million ounces of
gold and 7.8 million ounces of silver in proven and probable
Goldcorp hired the Bank of Nova Scotia to sell Los Filos and
its Camino Rojo gold and silver project in Mexico.
The company is also considering options for its 100
percent-owned Marlin mine in Guatemala and 37.5 percent stake in
Argentina's Alumbrera mine, Chief Executive David Garofalo told
Reuters in July.
Goldcorp granted Bluestone the right of first refusal for
certain Marlin assets and equipment on Wednesday.
(With additional reporting by John Benny in Bengaluru; Editing
by Savio D'Souza and Tom Brown)