Timmins Gold Corp. has stepped up a war of words in the battle to buy New Yorks Capital Gold Corp.
Torontos Gammon Gold Inc. (TSX:GAM) offered US$355 million last week to acquire Capital Gold.
Vancouver-based Timmins (TSX:TMM) believes Capital shareholders should prefer its $372 million hostile offer.
Timmins CEO Bruce Bragagnolo issued an open letter March 24 to Capital Gold shareholders to counter statements made by Capitals board of directors, which indicated that Gammon would be a better partner.
Bragagnolo urged those shareholders to reject the Gammon deal.
The two companies are after Capital Golds El Chanate mine in northern Mexico. Timmins and Gammon both own active mines near the El Chanate mine.
The takeover battle began in September 2010 when Timmins made a hostile bid for Capital Gold. Gammon followed with its own offer the following month.
Gammon is offering Capital Golds stockholders 0.52 Gammon shares and US$1.09 in cash for each common share of Capital Gold they hold.
Timmins offer is 2.27 Timmins shares and $0.25 for each common share of Capital Gold held.
In the letter, Timmins outlines Gammons finances and explains why Timmins is a better choice. Timmins urges shareholders to vote against the Capital Gold boards proposal to adopt the plan of merger with Gammon and send a message to the Capital board that it should give proper consideration to all proposals it receives.
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