According to news sources, Newmont, a Denver-based US mining firm, has launched a bid offer to purchase Australian rival Newcrest Mining.
Newmont, which operates mines in Ghana, has made a $19.5 billion deal to buy Newcrest, which has been termed as a “mega bid” in the sector.
According to reports, Newmont made the approach with a bid of roughly $17 billion, making the latest bid 16% more than the initial proposal and representing a 46% premium to Newcrest’s share price on February 3 before Newmont’s first bid was published.
In a press release issued yesterday, April 11, 2023, Newmont stated that the proposed merger with Newcrest is based on 0.380 Newmont shares for every Newcrest share, resulting in the combined business being 30% controlled by Newcrest and 70% held by Newmont.
“We think a combination of Newmont and Newcrest delivers a tremendous value proposition to our respective shareholders, workforce, and the communities in which we operate,” said Tom Palmer, President and CEO of Newmont.
“The proposed acquisition would bring together industry-leading portfolios of assets and projects to produce long-term value throughout the combined global organization, and we welcome Newcrest’s Board of Directors’ consideration,” he said.
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“This acquisition will improve our position as the world’s leading gold firm by bringing together two of the sector’s top senior gold producers and setting a new standard in safe, lucrative, and responsible mining,” he added. We would be well-positioned as the clear gold-mining leader to create robust, steady, and long-term returns with best-in-class sustainability performance for decades to come.”
The new sweetened bid has been confirmed by Newcrest.
“I believe that this offer finds a better balance. “We are supportive of the Newcrest-Newmont combination and aim to remain a stakeholder of the merged firm if the transaction goes forward,” Simon Mahwinney, chief investment officer at Newcrest’s largest shareholder Allan Gray Australia, told Reuters.
If the transaction is authorized by regulators, Newmont will possess four of Australia’s top mines.
With the acquisition of Normandy Mining in 2002, Newmont made its first foray into Australia. Afterwards, the US miner purchased Boddington and Tanami.
