Teck Cominco offers 29% premium for Aur Resources


From Reuters
via Yahoo News
Tuesday, July 2, 2007


TORONTO -- Teck Cominco said on Tuesday it would buy Aur Resources in a friendly cash and stock offer worth C$4.1 billion ($3.87 billion), boosting the base metal giant's copper production.

Each Aur shareholder will receive C$41, or 0.8749 of a Teck Class B subordinate voting share, per Aur common share on a pro-rated basis.

The C$41 a share offer for Aur is a 29 percent premium to the company's closing price on Friday of C$31.70 on the Toronto Stock Exchange.

Teck said it would pay a maximum of C$3.1 billion in cash and issue a maximum of about 22 million shares. At full pro-ration, Aur shareholders would receive C$30.75 in cash and 0.2187 of a Teck Cominco class B share per Aur common share.

"The acquisition of Aur Resources will immediately increase our cash flow and add substantially to our long term growth in copper production," Teck President and Chief Executive Donald Lindsay said in a statement.

The acquisition will boost Teck's annual copper production by 43 percent to more than 200 million pounds, the company said. Annual output will jump by 342 million pounds, or 72 percent, by 2010 compared with its 2007 pre-transaction level.

The deal represents further consolidation in the Canadian mining sector. Last week Yamana Gold said it would acquire Northern Orion Resources, paving the way for the combined company to make a bid for Meridian Gold.

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