An offer to buy one of the hottest gold properties in the Yukon has been made by one of the largest gold producers in the world – for $520 million.

The Kaminak Gold Corp. announced this morning Goldcorp Inc. has made an offer which is still subject to shareholder approval.

Under the proposal, Goldcorp will provide one-10th of a Goldcorp share to purchase each Kaminak share, increasing the value of each share substantially.

Kaminak has been pressing to bring its Coffee gold property into production, with plans to spend $29 million this year to advance the project on several fronts.

The company, for instance, announced last week it’s planning to spend $14 million to begin the work necessary for the permitting process, with an aim of having its project proposal before the environmental assessment board later this summer.

There’s also $5 million allotted for continued exploration of the property, located 130 kilometres south of Dawson City.

Kaminak vice-president Tony Reda said this morning the company will stay the course with the schedule it has laid out.

“These programs are still moving forward and active as we speak,” Reda said from his Vancouver office.

He said what happens if and when the transaction is completed in mid-August as scheduled will be up to Goldcorp, he explained.

Goldcorp vice-president Brent Bergeron said this morning from Vancouver his company liked what it saw in Kaminak’s Coffee Gold Project.

It liked what it saw in the potential for the Coffee project, and liked Kaminak’s plans moving forward, and Goldcorp is not likely to stray far from that vision, he said.

In last week’s announcement of anticipated spending in 2016, Kaminak re-affirmed its goal of being ready for construction in the first half of 2018, with initial production at the open pit mine beginning in late 2019.

“Kaminak’s directors unanimously recommend that Kaminak shareholders vote in favour of the Arrangement, and each director intends to vote all of the Kaminak shares they own or control at the date of the Arrangement meeting in favour of the Arrangement, in the absence of a superior proposal,” says today’s new release from Kaminak.

Under the arrangement, Kaminak has agreed not to search for better offers but is free to accept one if one is made, though Goldcorp retains an option to match the better offer.

A vote by Kaminak shareholders will occur no later than July 14, says the release.

Trading of Kaminak shares on the Toronto Stock Exchange was halted briefly this morning while the company released the announcement.

Share prices for both Kaminak and Goldcorp will fluctuate under normal trading influences until the proposal is concluded either way.

Goldcorp, however, will remain committed to providing 1/10 of a Goldcorp share to purchase each Kaminak share.

Kaminak shares were trading this morning at $2.50 each, a jump of 52 cents per share after trading began. Goldcorp shares were trading at $23.21.

The Kaminak news release says: “Goldcorp has the financial strength and flexibility to develop the Coffee Gold Project and unlock the significant resource expansion potential at Coffee in the short to medium term.”

Kaminak president Eira Thomas applauded the purchase proposal.

“This transaction realizes many immediate benefits for our shareholders and at the same time ensures that the Coffee Gold Project will be developed in a timely and responsible manner,” Thomas says in the release.

“Goldcorp is a leading gold producer with a strong track record of responsible mining in Canada and a growth strategy focused on adding low-cost gold production in politically stable jurisdictions.

“Coffee is a natural fit within their portfolio and they have the experience, expertise and financial flexibility to build Coffee for the benefit of our First Nations partners and all Yukon stakeholders.”

Bergeron said Goldcorp’s management strategy includes looking for junior mining company’s working in promising areas where there is potential for growth, in jurisdictions that support a strong mining sector

Kaminak and its Coffee project fit the bill, he said.

Bergeron said Kaminak has also worked hard to build strong relationships with First Nations, communities and government.

Community relations, building partnerships is a priority for Goldcorp as well, Bergeron said.

He explained the proposed purchase has been approved by Goldcorp’s board of directors, and no further approval by shareholders is required.

As a matter of routine, Goldcorp watches for investments that fit with its goals, Bergeron said.

He said the while the company has not been focused on the Coffee property specifically, it has been keeping its eye on the Yukon in general terms.

Goldcorp representatives have met regularly over the years with Yukon government officials at the annual conference hosted by the Prospectors and Developers Association of Canada, Bergeron pointed out.

He said when Kaminak became a company of interest, Goldcorp conducted its due diligence, it looked at the technical aspects of the Coffee project but it also looked at what Kaminak has done to build partnerships.

Goldcorp representatives will be in Dawson City for the annual international gold show over the May long weekend.