Yamana Gold — Meridian Gold — Merger or Acquisition (September 2007)
39 slides from Yamana Gold's merger presentation, Sep 24, 2007
Slide 1: A Winning Combination
A Winning Combination September 2007
Slide 2: Cautionary Statement
Cautionary Statement All monetary amounts in U.S. dollars unless otherwise stated This presentation contains certain “forward-looking statements” and “forward-looking information” under applicable securities laws concerning the proposed transaction and the business, operations and financial performa
Slide 3: Cautionary Note to U.S. Investors Concerning Estimates of Resources
CAUTIONARY NOTE TO U.S. INVESTORS CONCERNING ESTIMATES OF MEASURED, INDICATED AND INFERRED RESOURCES This presentation uses the terms “Measured”, “Indicated” and “Inferred” Resources as defined in accordance with National Instrument 43-101 - Standards of Disclosure for Mineral Projects. United State
Slide 4: More Information and Where to Find It (Cont'd)
MORE INFORMATION AND WHERE TO FIND IT (Cont’d) Meridian’s Board will issue a Notice of Change to its Directors’ Circular and amend its Solicitation/Recommendation Statement on Schedule 14D-9 in response to the revised Yamana offer. Each of these revised documents will contain important information,
Slide 5: Yamana Gold + Meridian + Northern Orion: A Winning Combination
Yamana Gold + Meridian + Northern Orion A Winning Combination New Yamana delivers: 1) A leading growth profile – reserves, production and cash flow 2) The highest earnings per $1,000 invested vs peer group 3) One of the highest levels of cash flow per $1,000 invested 4) Superior exploration and deve
Slide 6: A Leading Growth Profile
® PIES NORTHERN YAMANAGOLD ORION [eee Eait A Leading Growth Profile
Slide 7: New Yamana has one of the Largest Gold Resource Bases Amongst Intermediates
Source: Company filings and public equity research (does not include any non-gold resources) Gold Reserves and Resources (Moz) Meridian Eldorado Northern Orion Centerra Yamana Agnico-Eagle IAMGOLD New Yamana Kinross 0 10 20 30 40 50 Reserves M&I Resources Inferred Resources New Yamana has one of the
Slide 8: A Leading Gold Producer Amongst Intermediates
A LEADING Gold Producer Amongst Intermediates ....... Annual gold production 2007 & 2008 (Moz) Source: Company filings and public equity research 1.7 1.0 1.0 0.6 0.6 0.3 0.3 0.2 0.1 2.2 1.2 1.0 0.8 0.8 0.3 0.5 0.5 0.1 0.0 0.5 1.0 1.5 2.0 2.5 Kinross New Yamana IAMGOLD Yamana Centerra Meridian Eldora
Slide 9: With Further Growth Potential
With Further Growth Potential ..... Includes expansion of Jacobina up to 8,200 tpd by 2009 and development of Gualcamayo, São Vicente and C1 Santa Luz properties in 2008 SUSTAINABLE + FURTHER UPSIDE Expansions Gualcamayo El Peñón Chapada San Andres Esquel Agua Rica Other Gold production (ounces) 0 2
Slide 10: One of the Lowest Cash Cost Profiles
And, One of the LOWEST Cash Cost Profiles Source: Equity research 2007E By-product cash costs ($per ounce of gold) Yamana ($500) ($400) ($300) ($200) ($100) $0 $100 $200 $300 $400 $500 Agnico- Eagle New Yamana Meridian Goldcorp Barrick Eldorado Newmont Kinross IAMGOLD Centerra
Slide 11: Operating Cash Flow Growth
Operating Cash Flow Growth Assumes gold price of $600/oz, copper prices of $3.40 in 2007, $3.20 in 2008, $2.85 in 2009, $12/oz Ag, $1.25/lb Zn in 2007 and then $0.65/lb Zn onward, $25/lb Mo in 2007, $20 in 2008 and then $10 onward Operating cash flow ($ million) $500 $600 $700 $800 2007 2008 2009 SU
Slide 12: $2 billion of Cumulative Cash by 2010
$2 billion of Cumulative Cash by 2010 Assumes gold price of $600/oz, copper prices of $3.40 in 2007, $3.20 in 2008, $2.85 in 2009, $12/oz Ag, $1.25/lb Zn in 2007 and then $0.65/lb Zn onward, $25/lb Mo in 2007, $20 in 2008 and then $10 onward; assumes exercise of all warrants/options in the money Fre
Slide 13: Superior Investment
® SON ences YAMANAGOLD RESOURCES INC QW : Superior Investment
Slide 14: Attractive Returns per Dollar Invested
Attractive Returns per Dollar Invested On a per dollar invested basis, New Yamana is returning on average approximately 60% more earnings compared to industry peers 2007E Earnings per $1,000 Invested1 $- $2.00 $4.00 $6.00 $8.00 $10.00 $12.00 $14.00 $16.00 $18.00 $20.00 Barrick Yamana New Yamana Eldo
Slide 15: Attractive Cash Flow per Dollar Invested
Attractive Cash Flow per Dollar Invested On a per dollar invested basis, New Yamana’s cash flow is amongst the highest of industry peers Yamana’s cash flow per dollar invested was the highest 2007E Cash Flow per $1,000 Invested1 $- $5.00 $10.00 $15.00 $20.00 $25.00 Yamana IAMGOLD Eldorado New Yamana
Slide 16: Cash Flow Sensitivity
Cash Flow Sensitivity New Yamana provides significant leverage to the gold price $0 $50 $100 $150 $200 $400 $800 $1,200 $1,000 $600 Cash flow per $1,000 invested at gold prices of $400 to $1,200 per ounce 1 Calculated as 2008E operating cash flow per $1,000 invested
Slide 17: Exploration + Development + Operational Excellence = Value Creation
Exploration + Development + Operational Excellence = Value Creation
Slide 18: Yamana's Track Record of Exploration Success
Yamana’s Track Record of EXPLORATION Success World Class Exploration Four Major Greenstone Belts — Rio Itapicaru Greenstone Belt — Guapore Gold Belt — Bahia Gold Belt — Pillar de Goias Greenstone Belt Other Prospective Areas — Gualcamayo — Central America New Yamana is budgeting $60 million for expl
Slide 19: Meridian's Track Record of Exploration Success
Meridian’sTrack Record of EXPLORATION Success Esquel Minera Florida Amancaya El Peñón Millo Amaca Mercedes Rossi Multiple Nevada Assets Bonsuccesso Argentina Brazil Mexico United States Peru World Class Exploration World-class, low cash cost, high grade consistently profitable deposits Mining-friend
Slide 20: A Track Record of Building Mines (Yamana)
A Track Record of BUILDING Mines Planned production of 100,000 oz gold per year 2008 C1 Santa Luz Planned production of 55,000 oz gold per year 2008 São Vicente Planned production of 200,000 oz gold per year Potential to increase to 300,000 oz gold per year with QDD Lower West 2009 2010 Gualcamayo I
Slide 21: A Track Record of Building Mines (Meridian)
A Track Record of BUILDING Mines Meridian has the following growth pipeline Meridian built five mines over the history of the company, including the El Peñón gold mine Meridian has a history of meeting long-term production targets 100,000 oz per year – NI 43-101 in progress 2009 La Pepa 100,000+ oz
Slide 22: A Track Record of Value Creation via Acquisition
A Track Record of VALUE Creation via Acquisition Total return(1) to Desert Sun Mining shareholders to date of 57.5% M&I resource increase of 29.6% Total return(1) to RNC Gold shareholders to date of 144% M&I resource increase of 58.6% Total return(1) to Viceroy shareholders to date of 46% M&I resour
Slide 23: Attractive Risk/Reward Proposition
Attractive Risk/Reward Proposition
Slide 24: Geographic & Operational Diversification
Yamana Meridian Northern Orion San Andrés São Vicente São Francisco Ernesto C1 Santa Luz Jacobina Fazenda Brasileiro Fazenda Nova Chapada HONDURAS BRAZIL ARGENTINA El Peñón Esquel Alumbrera (12.5%) Rossi (40%) Minera Florida Agua Rica NEVADA Geographic & Operational Diversification Gualcamayo CHILE
Slide 25: Assets in Mining-Friendly Jurisdictions
Assets in MINING-FRIENDLY Jurisdictions New Yamana’s mines are located in the top 10 mining-friendly jurisdictions Source: Behre Dolbear & Company, Inc., 2007 Ranking of Countries for Mining Investment Top 10 jurisdictions Risk ranking of countries (from best to worst) Australia Canada USA Chile Mex
Slide 26: Why Meridian Recommends Shareholders Tender to Yamana's Offer
Why Meridian Recommends Shareholders Tender to Yamana’s Offer
Slide 27: Attractive Premium
Attractive Premium Yamana’s offer represents a significant premium to the 20-day volume weighted trading price Source: Company filings; Bloomberg 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% Goldcorp - Wheaton Yamana - Desert Sun Agnico -Eagle - Cumberland Barrick - Placer Dome Kinross - Bema
Slide 28: The Street Agrees... It's a Winning Combination
Yamana + Northern Orion + Meridian “We believe the bid now represents a full and fair price. Absent a superior offer materializing, we would recommend that Meridian shareholders tender to this improved offer.” - TD, September 21, 2007 “In our opinion, this latest increase in Yamana’s offer for Merid
Slide 29: Greater Upside Potential for Meridian Shareholders
Greater UPSIDE Potential for Meridian Shareholders +37% Upside to MNG Target Price 82% Upside to MNG Price Pre-Announcement MNG consensus analyst target price Implied MNG price based on offer & YRI consensus target price Source: Equity research as at June 27, 2007 C$34.84 C$47.66
Slide 30: Resulting in Consistent Outperformance
Resulting in Consistent OUTPERFORMANCE Source: FactSet; returns indexed to July 2003 1 Peer index consists of Barrick, Goldcorp, Kinross, Agnico-Eagle, Centerra, IAMGOLD, and Randgold 0% 100% 200% 300% 400% 500% 600% 700% 800% 900% 1000% Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07
Slide 31: A Winning Combination
® SON ences YAMANAGOLD RESOURCES INC QW : A Winning Combination
Slide 32: Yamana Gold + Meridian + Northern Orion: A Winning Combination
Yamana Gold + Meridian + Northern Orion A Winning Combination A Leader in Production Growth Sustainable annual production of 1.5 Moz by 2009 Low Cash Cost Producer Sustainable cash cost below zero Superior Free Cash Flow and Operating Cash Flow Cash Balances growing to approximately $2.0 billion1 by
Slide 33: A Winning Combination (cont'd)
Yamana Gold + Meridian + Northern Orion A Winning Combination (cont’d) Core Asset Base Deepens Latin American Presence Chile (El Penon), Argentina (Agua Rica & Alumbrera, Gualcamayo) and Brazil (Chapada, Jacobina, Sao Francisco) Core assets in some of the most stable jurisdictions in the world Diver
Slide 34: Strategic Plan
STRATEGIC Plan Continued value creation Organic growth Significant exploration Resource expansion Production increases Gold production growth targets from existing properties 2009: 1.5 million ounces Increasing to . . . 2012: 2.2 million ounces Targeting 2.2 million oz of gold production by 2012
Slide 35: Appendix
® SON ences YAMANAGOLD RESOURCES INC QW : Appendix
Slide 36: Reserves & Resources - Yamana (Reserves)
Reserves & Resources - Yamana As at December 31, 2006 Mineral reserves (proven and probable) 1 As of October 31, 2006 Source: Yamana Gold Inc 2006 Annual Report Proven reserves Probable reserves Total — proven and probable Tonnes Grade Contained Tonnes Grade Contained Tonnes Grade Contained (000’s)
Slide 37: Reserves & Resources - Yamana (Resources)
Reserves & Resources – Yamana As at December 31, 2006 Mineral resources (measured, indicated and inferred) (measured and indicated include reserves as outlined above) 1 As of October 31, 2006 Source: Yamana Gold Inc 2006 Annual Report Measured resources Indicated resources Total — measured and indic
Slide 38: Reserves & Resources - Northern Orion
Reserves & Resources – Northern Orion As at December 31, 2006 Reserves & Resources 1 The reserves and resources at Alumbrera are based on the JORC Code. The reserves and resources shown for Alumbrera are Northern Orion’s 12.5% ownership of the mine 2 Measured and Indicated Resources include the Prov
Slide 39: Reserves and Resources - Meridian
Reserves and Resources – Meridian As at December 31, 2006 Reserves & Resources Source: Meridian Gold Inc. 2006 Annual Report (available under Meridian Gold Inc.’s profile at www.sedar.com) Grade Contained metal Tonnes Zn (%) Ag (g/t) Au (g/t) Zn (tonnes) Ag (oz) Au (oz) Total—Proven and probable res
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