Bankers have cut the price on the Tahoe Resources Inc. stock offering, after struggling to sell nearly $1-billion worth of the gold company's shares for three days.
The deal has now been repriced to $16.80 a share, down from the original $17.20, according to people familiar with the deal.
The group of banks responsible for selling the shares will take a hit after agreeing to buy Goldcorp Inc.'s 26 per cent stake in Tahoe in a bought deal. Because the banks, led by GMP Securities and Bank of Montreal, already bought the Tahoe shares from Goldcorp, the banks are now responsible for getting rid of the Tahoe stock.
The entire deal is now worth $975-million instead of $998-million.
Since the deal was announced late on Monday, Tahoe's shares have traded below the original $17.20 offering price, making it cheaper for investors to buy Tahoe on the open market.
This is the second time this year that a precious metal share offering has struggled amid a four year slump in gold prices. Silver Wheaton Corp. launched its own $1-billion offering to finance an acquisition, and Bay Street collectively lost millions on the deal.
Tahoe's shares fell by 9 per cent after the deal was announced to $16.41 on Tuesday. Shares closed at $16.97 on Thursday.