Tahoe shares plummet on Guatemalan proposal #mininglaw
Tahoe shares plummet on Guatemalan proposal
Peter Koven Jun 28, 2012 – 10:50 AM ET, Financial Post
Shares of emerging silver company Tahoe Resources Inc. plunged 40% on Thursday morning following reports that Guatemala is seeking to buy stakes of up to 40% in mining companies operating in the country.
Tahoe is developing the very promising Escobal silver deposit in Guatemala, which it acquired from Goldcorp Inc. in 2010. If the proposal from President Otto Perez Molina becomes law, it could have a devastating effect on the company.
In addition to acquiring stakes in mining companies, Mr. Perez Molina reportedly wants to increase mining taxes.
Guatemala has been one of the most challenging countries for mining companies to operate in, as they have found themselves at odds with the indigenous population.
Tahoe shares were halted repeatedly on Thursday morning as the Guatemalan news spread among investors.