A Powerful Combination to Set the Standard in
Safe, Profitable and Responsible Gold and Copper Mining
Newmont Corporation (NYSE: NEM, TSX: NGT) submitted a revised
non-binding indicative proposal to the Board of Directors of
Newcrest Mining Limited (Newcrest) to acquire 100 percent of the
issued share capital of Newcrest by way of an Australian Scheme of
Arrangement, under which Newcrest shareholders would receive 0.400x
Newmont shares per each Newcrest share held. In addition, Newcrest
would have the right to fund and pay to its shareholders a special
dividend of up to USD$1.10 per Newcrest share. Newmont’s improved
offer on these terms is best and final, subject only to no superior
proposal emerging (and is referred to in this release as the Best
and Final Proposal).
The Newcrest Board of Directors has agreed to grant Newmont
confirmatory due diligence access to enable Newmont to put forward
a binding proposal. Due diligence is expected to be completed
within approximately four weeks. Newcrest has indicated that it
intends to grant exclusivity to Newmont during the due diligence
period, with the terms of that exclusivity still to be agreed.
Newcrest will also undertake confirmatory due diligence on Newmont
during this period.
“We are entering a new era in which mining companies must hold
themselves to a higher standard of sustainability and long-term
value creation. This transaction would strengthen our position as
the world’s leading gold company by joining two of the sector’s top
senior gold producers and setting the new standard in safe,
profitable and responsible mining,” said Tom Palmer, President and
CEO of Newmont. “Together as the clear gold-mining leader, we would
be well-positioned to generate strong, stable and lasting returns
with best-in-class sustainability performance for decades to
come.”
The proposed combination creates the industry’s best portfolio
of world-class assets with the highest concentration of top-tier
operations, primarily in favorable, low-risk mining jurisdictions.
Newmont would further strengthen its portfolio by increasing annual
copper production and adding nearly 50 billion pounds of copper
reserves and resources to its balanced and diverse asset base.
By applying Newmont’s long track record of safe and profitable
mining, the combined group is expected to deliver significant
annual synergies and create long-term value for all stakeholders.
The business would be immediately supported by Newmont’s scalable,
integrated operating model with a deep bench of subject matter
experts and existing regional platforms in Australia and Canada.
This would allow the business to leverage the combined group’s
global supply chain and generate substantial synergies through the
implementation of Newmont’s proven Full Potential continuous
improvement program.
As demonstrated by the Goldcorp acquisition in 2019, Newmont
delivered annual synergies of more than $1 billion, which continue
to benefit the Company today and over the long term. Over the last
four years, these initiatives focused on optimizing processing
circuits, improving loading and haulage performance, reducing mill
and equipment downtime and implementing new methods and
technologies to increase mining rates across the portfolio.
Newmont would also apply its rigorous and industry-leading
approach to asset management, identifying potential opportunities
to optimize the combined portfolio and bring forward the most
accretive projects as part of its strategy to maximize value for
shareholders and other stakeholders.
The Best and Final Proposal
Under the terms of the Best and Final Proposal, Newcrest
shareholders would own approximately 31 percent of the combined
company. Newmont intends to apply for a foreign exempt listing on
the Australian Securities Exchange (ASX) and establish Chess
Depositary Interests on ASX in respect to Newmont shares issued to
Newcrest shareholders under the Best and Final Proposal. The terms
of the Best and Final Proposal represent a premium1 of:
- 35 percent based on the closing price of Newcrest and Newmont
shares on February 3, 2023, being the last trading day prior to the
initial market release confirming Newmont’s proposal, and inclusive
of the value of a special dividend of up to USD$1.10 per Newcrest
share.
The Best and Final Proposal is subject to customary conditions,
including the parties entering into a Scheme Implementation
Agreement (SIA) following satisfactory completion of due diligence
and a unanimous recommendation from Newcrest’s Board of Directors
that Newcrest shareholders vote in favor of the Best and Final
Proposal (in the absence of a superior proposal and subject to an
independent expert concluding that the Best and Final Proposal is
in the best interests of Newcrest’s shareholders).
If the Best and Final Proposal conditions are satisfied (or
waived) and the Best and Final Proposal proceeds, implementation of
the Best and Final Proposal will be subject to conditions expected
to include (among other things) approval by Newmont and Newcrest
shareholders, relevant regulatory approvals, Australian court
approval and other conditions customary for a transaction of this
nature.
Newmont remains fully committed to acting in the best interests
of its shareholders. Newmont and its Board of Directors advises
shareholders need not take any action at this time as there can be
no certainty that any transaction will be concluded.
Newmont has engaged BofA Securities, Centerview Partners LLC and
Lazard as its financial advisers, and King & Wood Mallesons and
White & Case LLP as its legal advisers.
_________________________
1Premium analysis calculated by reference to the exchange ratio
of 0.400x shares of Newmont for each Newcrest share held and a
special dividend of up to USD$1.10 per Newcrest share.
- Share prices based on NYSE and ASX trading of Newmont and
Newcrest shares, respectively, as at close of February 3, 2023 of
Newmont US$49.85/share and Newcrest A$22.45/share with AUD / USD of
0.692
- As characterized in Newcrest’s press release on April 11, 2023,
the 46.4 percent premium reflects the increase in Newmont’s share
price from February 3, 2023 to April 6, 2023, while holding the
Newcrest share price constant at February 3, 2023. This assumes a
Newmont price of US$52.05/share with AUD / USD of 0.667
Benefits of the Proposed Transaction
- Best portfolio of world-class
assets: Combines high-quality operations, projects and
reserves focused in low-risk jurisdictions, supporting multiple
decades of profitable gold and copper production.
- Ideal commodity mix with gold and copper
exposure: Creates an enhanced portfolio with approximately
30 percent of the combined reserves in copper, a critical metal for
reducing carbon emissions and facilitating the ongoing transition
to a new energy economy.
- The gold sector’s recognized
sustainability leader: Leverages Newmont’s leading position
with a demonstrated commitment to leading environmental, social and
governance practices.
- Established position in Australia:
Creates robust economies of scale, which facilitates access to top
talent, leading technology and the opportunity to leverage global
functional expertise and optimized cost structures.
- District potential in highly-prospective
Golden Triangle: Strengthens position in British Columbia,
creating the opportunity to leverage regional infrastructure,
global systems, diverse ore body experience and expertise in block
cave mining.
- Scalable operating model with a track
record of delivering value: Leverages Newmont’s integrated
operating model and proven Full Potential program, which has
delivered annual benefits of over $1 billion following the Goldcorp
acquisition.
- Unparalleled financial strength:
Supports a disciplined capital allocation strategy, maintaining the
industry’s strongest balance sheet with flexibility throughout the
commodity cycle to support portfolio reinvestment and deliver
attractive shareholder returns.
No Offer or Solicitation
This news release is neither an offer to purchase or exchange
nor a solicitation of an offer to sell securities of Newmont or
Newcrest. In furtherance of this proposal and subject to future
developments, Newmont may file one or more proxy statements or
other documents with the SEC. This communication is not a
substitute for any proxy statement, scheme booklet or other
document Newmont or Newcrest may file with the SEC and Australian
regulators in connection with the proposed transaction. INVESTORS
AND SECURITY HOLDERS OF NEWMONT AND NEWCREST ARE URGED TO READ THE
PROXY STATEMENT(S), SCHEME BOOKLET AND OTHER DOCUMENTS FILED WITH
THE SEC CAREFULLY IN THEIR ENTIRETY IF AND WHEN THEY BECOME
AVAILABLE AS THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE
PROPOSED BUSINESS COMBINATION TRANSACTION. Investors and
securityholders may obtain a free copy of the disclosure documents
(when they are available) and other documents filed by Newmont with
the SEC at the SEC's website at www.sec.gov. The disclosure
documents and other documents that are filed with the SEC by
Newmont may also be obtained on Newmont’s website at
www.newmont.com or obtained for free from the sources listed below.
Newmont and certain of its directors and executive officers may be
deemed to be participants in any solicitation of proxies from
Newcrest stockholders in respect of the proposed transaction
between Newmont and Newcrest. Information regarding Newmont’s
directors and executive officers is available in its proxy
statement for its 2023 annual meeting of stockholders, which was
filed with the SEC on March 10, 2023. This document can be obtained
free of charge from the sources indicated below. Additional
information regarding the interests of these participants in such
proxy solicitation and a description of their direct and indirect
interests, by security holdings or otherwise, will be contained in
any proxy statement and other relevant materials to be filed with
the SEC in connection with the proposed transaction if and when
they become available.
Cautionary Regarding Forward-Looking Statements
This press release contains “forward-looking statements” within
the meaning of Section 27A of the Securities Act and Section 21E of
the Securities Exchange Act of 1934, as amended, which are intended
to be covered by the safe harbor created by such sections and other
applicable laws. Where a forward-looking statement expresses or
implies an expectation or belief as to future events or results,
such expectation or belief is expressed in good faith and believed
to have a reasonable basis. However, such statements are subject to
risks, uncertainties and other factors, which could cause actual
results to differ materially from future results expressed,
projected or implied by the forward-looking statements.
Forward-looking statements address expected future results, and
often contain words such as “anticipate,” “intend,” “plan,” “will,”
“would,” “estimate,” “expect,” “believe,” “target,” “indicative,”
“preliminary” or “potential.” Forward-looking statements may
include, without limitation, statements relating to the proposal to
acquire the share capital of Newcrest, expected terms, including
consideration and premium, and expected benefits and opportunities
of the proposal, including in connection with value creation. There
is no certainty that any transaction will occur on the proposed
terms, within any particular timeframe, or at all. Risks include
fluctuations in company stock price and results of operations;
uncertainties regarding the outcome of discussions between Newmont
and Newcrest with respect to the proposal, including the
possibility that the parties may not agree to pursue a business
combination or may be materially different from the terms of the
proposals described herein; the ability to consummate the proposed
combination or achieve the expected benefits; uncertainties with
respect to shareholder approvals; potential regulatory or closing
delays; the industry and market reaction to Newmont’s proposal; and
changes in the overall economic conditions. The forward-looking
statements are also subject to other risks and uncertainties,
including those more fully described in Newmont’s Annual Report on
Form 10-K for the fiscal year ended December 31, 2022 and SEC
filings. Newmont does not undertake any obligation to communicate
publicly revisions to any “forward-looking statement” to reflect
events or circumstances after the date of this press release or to
reflect the occurrence of unanticipated events, except as may be
required under applicable securities laws. Investors should not
assume that any lack of update to a previously issued
“forward-looking statement” constitutes a reaffirmation of that
statement. Continued reliance on “forward-looking statements” is at
investors’ own risk.
About Newmont
Newmont is the world’s leading gold company and a producer of
copper, silver, zinc and lead. The Company’s world-class portfolio
of assets, prospects and talent is anchored in favorable mining
jurisdictions in North America, South America, Australia and
Africa. Newmont is the only gold producer listed in the S&P 500
Index and is widely recognized for its principled environmental,
social and governance practices. The Company is an industry leader
in value creation, supported by robust safety standards, superior
execution and technical expertise. Newmont was founded in 1921 and
has been publicly traded since 1925.
At Newmont, our purpose is to create value and improve lives
through sustainable and responsible mining. To learn more about
Newmont’s sustainability strategy and initiatives, go to
www.newmont.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20230410005467/en/
Media Contact Omar Jabara
720.212.9651 omar.jabara@newmont.com
Investor Contact Daniel Horton
303.837.5468 daniel.horton@newmont.com
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