Lundin (LUN), Equinox (EQN) Battling Over Value

The board of Lundin Mining (TSE:LUN) has recommended its shareholders reject Equinox Minerals (TSE:EQN) hostile C$4.8 billion offer for the company, citing a low valuation on the company's assets.

Lukas Lundin, chairman of Lundin Mining, said, "The offer has such extensive conditions that even if the amount of the offer was not so financially inadequate, the board would not recommend that shareholders accept the offer because we have no confidence that it would ever close."

"Equinox is essentially asking shareholders to grant them an option to acquire Lundin Mining at their discretion, and their lenders discretion, at a price that is inadequate and contains substantial risks if implemented," said Lundin CEO Phil Wright.

The board said Equinox's offer is inadequate because it undervalues the assets owned by Lundin. The directors also claimed "risk factors inherent in the Equinox operations will affect the ability of the common shares of Equinox to continue to trade at their current levels and multiple to net asset value for any sustained period."

Equinox was trading at $5.38 in Toronto, up $0.14, or 2.67 percent. Lundin was at $7.27, falling $0.07, or 0.95 percent.




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Teck (NYSE:TCK), Kinross (NYSE:KGC), Goldcorp (NYSE:GG) Drop on Stronger U.S. Dollar

Canadian stocks across the overall market dropped as the U.S. dollar strengthened, including Canadian-based miners Teck Resources Ltd. (NYSE:TCK), Kinross Gold Corp. (NYSE:KGC) and GoldCorp Inc. (NYSE:GG).

Out of the twelve sectors represented on the Toronto Stock Exchange, eleven of them dropped.

The index measuring the diversified metals and mining sector lost 2.56 percent, with Teck Resources closing at $48.08 in New York, dropping $2.07, or 4.13 percent. Lundin Mining (TSE:LUN) closed in Toronto at $6.64, losing $0.19, or 2.79 percent.

Gold miner Kinross fell to $18.47, losing $0.67, or 3.50 percent. Goldcorp closed in New York at $46.30, dropping $1.28, or 2.69 percent. Trading volume on both was far above the 3-month average.

The U.S. dollar bought 1.0078 Canadian dollars at 2000 GMT.

Teck Resources (NYSE: TCK), Barrick Gold (NYSE: ABX), Lundin Mining (TSE:LUN) Down as Gold Falls in Price

Teck Resources (NYSE: TCK) (TSE:TCK-B), Barrick Gold (NYSE:ABX) (TSE:ABX) and Lundin Mining (TSE:LUN) are all down today as gold prices drop.

Even when gold prices were up earlier in the session, these gold miners struggled, seeming to point to traders taking profits after a nice run last week.

As of 12:50 P.M. EST, gold prices were at $1,225.10, a decline of $6.30 an ounce.

This isn't a surprise to see the profit-taking, and traders are also looking to see if there is going to be a correction in order to catch gold on its temporary way down, if that's the direction it goes.

Gold does have good support either way, and no matter what happens in the short term, it's going to continue its upward climb.

The major question is who is investing at this time, and if it's extended to the regular, small investor. When it does, that's when legitimate concerns over a gold bubble will apply.

Most investors have been institutional investors, and while that continues to be the case, we're not in danger of a gold bubble occuring.

Teck Resources (TSE:TCK-B) was down a little over 9 percent in New York, while Barrick Gold was down in New York by a little over 3 percent. Lundin Mining was off by just under 7 percent in Toronto, all at 1:00 P.M. EST.