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Franco-Nevada Acquires Gold Wheaton for $830 Million in Friendly Business Combination

Published: 03/14/2011

By Chris Hersh, Pollyanna Lord, Cathy L. Mercer, Jeffrey P. Roy, Paul M. Stein

On March 14, 2011, Franco-Nevada Corporation and Gold Wheaton Gold Corp. completed of the Plan of Arrangement pursuant to which Franco-Nevada has acquired all of the outstanding common shares of Gold Wheaton that it did not already own and Gold Wheaton has amalgamated with a wholly-owned subsidiary of Franco-Nevada to form Franco-Nevada GLW Holdings Corp.

In accordance with the Arrangement and as result of the exercise of most of the 2011 Gold Wheaton warrants before their expiry deadline of March 7, 2011, Gold Wheaton shareholders (including holders of 2011 warrants who exercised their 2011 warrants prior to the expiry deadline) will receive in the aggregate cash consideration of approximately $259 million and approximately 11.65 million Franco-Nevada common shares. In accordance with the maximum cash and share caps and pro-rationing mechanism under the Arrangement and as a result of Gold Wheaton shareholder elections, Gold Wheaton shareholders who elected or were deemed to have elected all cash will receive $5.20 in cash for each Gold Wheaton common share. Gold Wheaton shareholders who elected all shares will receive approximately 0.1262 of a Franco-Nevada common share and approximately $0.99, for each Gold Wheaton common share.

Three series of Gold Wheaton warrants remain outstanding with expiry dates of July 8, 2013, May 26, 2014 and November 26, 2014. Any of these warrants that were outstanding as of 12:01 a.m. (Vancouver time) on March 14, 2011 are now warrants of Franco-Nevada GLW Holdings Corp. that upon exercise will each entitle the holder thereof, at its election, to receive either 0.1556 of a Franco-Nevada common share or $5.20 in cash. Franco-Nevada GLW Holdings Corp. warrants that are due to expire on July 8, 2013, which were listed on the TSX under the symbol GLW.WT, will continue to be listed on the TSX under the symbol FNV.WT.B.

Cassels Brock acted for Gold Wheaton with a team that included Paul Stein, Cathy Mercer, Norm Findlay, Jeff Roy (M&A, Securities and Mining), Chris Hersh (Competition) and Pollyanna Lord (Securities and Mining).