Goldcorp, Barrick Gold to sell Marigold mine in Nevada to Silver Standard

The Canadian Press 0

TORONTO – Two of Canada’s largest gold miners have agreed to sell the Marigold mine in Nevada to Silver Standard Resources Inc. (TSX:SSO) for a total of US$275 million cash.

Goldcorp (TSX:G) owns two-thirds of Marigold, while Barrick Gold Corp. (TSX:ABX) owns the remaining third of the open pit mine.

Silver Standard said Marigold would immediately add to its cash flow and reserves and give its shareholders exposure to the gold sector.

“The acquisition of Marigold accomplishes our strategic goal of adding an operating mine in a well-established, low-risk mining jurisdiction,” said John Smith, Silver Standard’s president and CEO.

“We retain our financial capacity to continue internal growth and expect improved corporate operating cash flow going forward as a result of our 2013 cost restructuring program and the addition of the Marigold mine.”

The deal is subject to certain adjustments and is expected to close in April.

Silver Standard shares closed down 16 cents at C$8.39 while Goldcorp stock gained 34 cents to close at C$27.82. Barrick’s dropped 21 cents to C$21.21 on the Toronto Stock Exchange.

Barrick said it will receive US$86 million for its stake in the mine.

The Marigold sale is the second deal so far this year for Barrick. In late January, Barrick said it was selling its interest in two mine operations in Western Australia for AU$75 million in cash.

The sale of the Kanowna Belle and Kundana operations to Northern Star Resources Ltd is expected to close in March. The price, equivalent to about C$73.6 million, is subject to certain closing conditions.

Like other gold companies, Barrick has felt the impact of a sharp decline in gold prices. It has also had trouble with a major development project in South America that’s on hold due to environmental concerns.

Unlike Barrick, Goldcorp has been made a major expansion move this year.

It launched a C$2.6-billion hostile takeover bid for Osisko Mining Corp. (TSX:), which has rejected the offer as inadequate.

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