Why Coeur d'Alene's Shares Dropped
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Coeur d'Alene fell 10% today after the company offered to buy a Mexican silver miner.
So what: The company made a $383 million offer for Orko Silver, a competing bid from an offer by First Majestic Silver. The offer is for C$2.70 per share, a 26% premium to the competing offer, and it includes C$0.70 in cash, versus less than a penny in cash included in the First Majestic bid.
Now what: The only winner in this bidding war is Orko Silver's investors, who can watch these two companies fight over them. First Majestic can now respond with another bid or give up the asset to Coeur d'Alene. I don't think this is a reason to buy the stock here given the bidding war, which rarely works out for the acquiring company.
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The article Why Coeur d'Alene's Shares Dropped originally appeared on Fool.com.Fool contributor Travis Hoium and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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