- Newmont Corp (NYSE:NEM) inked a deal to fully acquire Newcrest Mining Limited (OTC:NCMGY) through an Australian court-approved Scheme of Arrangement unanimously recommended by Newcrest Mining's Board.
- The offer values Newcrest mining at around $19 billion (A$28.8 billion) and is the gold sector's biggest-ever transaction, Bloomberg reported.
- The combined company will be 31% owned by Newcrest and 69% by Newmont.
- Following a proposal rejection by Newcrest, Newmont raised the bid and submitted a final revised takeover offer last month.
- As per the deal, Newcrest's shareholders will receive 0.400 Newmont shares for each Newcrest share and get a special dividend per share of up to $1.10 from Newcrest, representing a 30.4% premium.
- With the inclusion of Newcrest's robust portfolio of long-life, low-cost gold and copper assets, Newmont becomes the global leader in gold mining, with 10 Tier 1 operations spread across several locations such as Australia, Papua New Guinea and Canada.
- The agreement will also boost Newmont's annual copper production, adding about 50 billion pounds of copper reserves and resources to its portfolio.
- Upon transaction closure in Q4 2023, Newmont expects to garner annual pre-tax synergies of $500 million within the first 24 months of the takeover.
- Also, it anticipates $2 billion in incremental cash flow in the first two years through portfolio optimization, leading to shareholders' value enhancement.
- Last month, Newmont disclosed the expectation of annual dividend payments for 2023 in the $1.40 - $1.80 per share range while reporting Q1 2023 results.
- Price Action: Newmont shares closed higher by 0.13% at $45.94 on Friday.
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