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Goldcorp to Buy Gold Eagle Mines

Written By Brian Hicks

Posted July 31, 2008



Goldcorp Inc. (NYSE: GG, TSX: G) and Gold Eagle Mines Ltd. (TSX: GEA) today announced an agreement whereby Goldcorp will acquire, through a friendly plan of arrangement, all outstanding shares of Gold Eagle.

Gold Eagle’s principal asset is the world class Bruce Channel gold discovery which is situated along the prolific Red Lake Trend, adjacent to Goldcorp’s Red Lake gold mine and immediately southwest of Goldcorp’s past-producing Cochenour-Willans Mine.

This transaction will enable Goldcorp to capitalize on its extensive exploration and operations expertise in the Red Lake district and its considerable human resources and related infrastructure.

The totalconsideration for 100% of the fully diluted shares of Gold Eagle would be approximately $1.5 billion. Based on the July 30, 2008 closing price and 20-day volume weighted average price for Goldcorp’s common shares on the TSX, and assuming full pro-ration, the transaction values each Gold Eagle share at C$12.62 and C$13.39, respectively.

On this basis, the consideration received by Gold Eagle shareholders represents a 19% premium to closing prices and a 36% premium to the 20-day volume-weighted average prices for each company.