Goldcorp to Acquire All Outstanding Shares of Probe Mines

Probe Mines Limited is pleased to announce that it has entered into a definitive agreement with Goldcorp Inc., whereby Goldcorp will acquire all of the outstanding shares of Probe under a plan of arrangement for consideration of 0.1755 of a Goldcorp share per Probe share, equivalent to C$5.00 per Probe share, based on the closing price of Goldcorp shares on the TSX on January 16, 2015, and total consideration of C$526 million. In addition, shareholders of Probe will receive shares in a newly formed company.

Transaction Details

  • Probe shareholders to receive 0.1755 of a Goldcorp share and one-third (1/3) of a New Probe share for each share of Probe
  • New Probe to contain:
    • Black Creek Deposit
    • Tamarack-McFauld's Lake Property
    • Victory Property
    • C$15 million in cash
    • C$4 million receivable related to the previous sale of a royalty on the Goldex mine; payment is expected in Q2-2015

Probe's board of directors has unanimously approved the transaction and recommends that Probe shareholders vote in favour of the arrangement. All of the directors and officers of Probe, who own approximately 4.6% of Probe's issued and outstanding shares, have entered into support agreements with Goldcorp pursuant to which they have agreed, among other things, to support the transaction and vote their Probe shares in favour of the arrangement. Goldcorp currently owns 8.4 million shares of Probe representing 9.3% of the basic shares issued and outstanding which will be voted in favor of the arrangement.

BMO Capital Markets has provided an opinion to Probe's board that the consideration is fair from a financial point of view to Probe shareholders other than Goldcorp.

Benefits to Probe Shareholders

  • Based on January 16, 2015 closing prices, the 0.1755 Goldcorp shares offered for each Probe share represents
    • Total consideration of approximately C$526 million, or C$5.00 per share, before ascribing any value to New Probe
    • Premium of 49% to Probe's closing share price on January 16, 2015
    • Premium of 57% to the volume weighted average price of Probe shares on the TSX-V for the 20-day period ending on January 16, 2015
  • Goldcorp is a high-quality, low-cost gold producer with an industry leading dividend, an investment-grade balance sheet and positive free cash flow generating ability
  • Goldcorp has the technical and financial capability to advance Borden and extensive milling and other infrastructure in the immediate area
  • Exposure to Goldcorp's portfolio of well diversified, world-class assets in safe jurisdictions
  • Ownership in New Probe, a well-capitalized exploration company created to leverage Probe management's exploration expertise, provides additional value to Probe shareholders

New Probe

Probe is pleased to be forming New Probe in partnership with Goldcorp to continue the success of the Probe team. Chairman Jamie Sokalsky and President and CEO David Palmer will continue in the same roles at New Probe along with members of Probe's board and management team. In addition to exploring the properties in its portfolio, Goldcorp looks forward to supporting New Probe in the execution of its business plan. Goldcorp will capitalize New Probe with C$15 million in cash and a C$4 million receivable related to Goldex and will retain its pro rata ownership of 9.3% in New Probe for a period of at least two years. Conservatively valuing New Probe at cash and receivable value would provide Probe shareholders with an additional C$0.18 per share of consideration. New Probe intends to make application to list its shares on the TSX-V.

Jamie Sokalsky, Chairman of Probe, commented, "We believe this transaction is an excellent outcome for Probe shareholders as it provides them with a significant premium that recognizes the value embedded in Borden. In addition, New Probe will be well funded and will continue to expose Probe shareholders to further potential exploration and development success. New Probe will also have an experienced Board of Directors and management team, and sufficient financial resources to immediately undertake active exploration. We welcome Goldcorp as a committed shareholder in New Probe and we look forward to creating ongoing value for shareholders."

David Palmer, President of Probe, states "Over the past four years Borden has grown into what is widely considered to be one of the best development assets in the industry and we are proud to have been part of this story with our shareholders. This acquisition represents not only a validation of the project and its value, but also an opportunity for shareholders to participate in future success with one of the industry's most respected gold producers, Goldcorp, as well as an experienced and committed team of explorers in New Probe. We are grateful for all of the support and loyalty from our shareholders and look forward to commencing the next phase together."

The transaction is subject to approval by Probe shareholders, court approval and other customary conditions. Full details of the transaction will be set out in Probe's information circular that it will prepare in respect of the meeting of shareholders to approve the transaction. Probe intends to mail the information circular in mid-February 2015. The transaction is expected to close at the end of the first quarter 2015.

Pursuant to the arrangement, Probe is subject to customary non-solicitation covenants. In the event a superior proposal is made to Probe, Goldcorp has a 3 business day right to match such proposal. Under certain circumstances where the transaction is not completed, Probe has agreed to pay a termination fee of C$18.4 million to Goldcorp.

Probe has engaged BMO Capital Markets as its financial advisor and Stikeman Elliott LLP as its legal advisor in connection with the transaction.



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