File photo of Chuck Jeannes, Goldcorp President and Chief Executive Officer.Ben Nelms/Reuters
Goldcorp Inc. has sold its stake in Tahoe Resources Inc. for nearly $1-billion as the gold miner beefs up its balance sheet amid weak bullion prices.
Goldcorp, the world's biggest gold company by market capitalization, sold its 26-per-cent stake in Tahoe for $17.20 per share for a total of $998-million.
A group of banks led by GMP Securities and Bank of Montreal bought the Tahoe shares and will resell them to investors. The share offering closes around the end of June.
It is unclear whether the sale will go smoothly – other offerings by precious metal companies have been difficult in the downturn.
The announcement comes on the day Royal Bank of Canada downgraded Goldcorp's stock to "sector perform" from "outperform," citing missed guidance and concerns over the miner's ability to continue paying its monthly dividend.
Goldcorp shares have dropped 7 per cent so far this year as the precious metal trades below $1,200 an ounce.
The company said divesting non-core assets has been "instrumental" to its growth and sound financial position.
Last week, Goldcorp increased its credit facility to $3-billion from $2-billion. In April, Goldcorp sold its stake in a Nevada gold project.
Rachelle Younglai