Sprott Asset Management plans US$800-million unsolicited bid for Canadian metals trusts

Financial Post

Sprott Asset Management LP plans to make an unsolicited offer to buy Central GoldTrust and Silver Bullion Trust for almost US$900 million, saying the precious metals companies are undervalued.

The share swap by Sprott, a Toronto-based money manager that focuses on gold and silver, represents an 8.3 per cent premium to the trusts’ combined market value of US$829 million, based on Wednesday’s closing price.

The Canadian trusts, which buy and hold gold and silver, have been under pressure from shareholder Polar Securities Inc., a Toronto-based hedge fund. Polar has been urging the trusts to change how unitholders can redeem their investment as a means of closing their trading gaps.

Sprott aims to use its broader marketing platform and investor relations expertise to close the gap between their unit price and their net asset value. Sprott projects it will add about US$3.33 per unit in value to Central GoldTrust and 96…

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