Newmont Enters into Definitive Agreement to Acquire Newcrest

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Algemeen advies 15/05/2023 05:51
Setting the Standard for Safe, Profitable and Responsible Gold and Copper Production from a World-Class Portfolio of Top-Tier Operations

Newmont has agreed to acquire Newcrest by way of an Australian Scheme of Arrangement (“Scheme”), under which Newmont will acquire 100 percent of the issued shares in Newcrest Mining Limited (“Newcrest”)
Newcrest shareholders to receive 0.400 Newmont shares (or 0.400 Newmont CDI1) for each Newcrest share and a special dividend of up to $1.10 per share paid by Newcrest, representing a 30.4 percent premium2
Further strengthens Newmont’s position as the responsible gold mining leader through the combination of high-quality operations, projects and reserves concentrated in low-risk jurisdictions, including 10 Tier 1 operations that will support decades of safe, profitable and responsible gold and copper production3
Complementary businesses create substantial opportunities for optimization; estimated annual pre-tax synergies of $500 million expected to be achieved within first 24 months4
Highly accretive for Newmont shareholders upon closing, with opportunity to enhance near-term cash flows, targeting at least $2 billion in the first two years after closing through portfolio optimization5
Maintaining Newmont’s balanced capital allocation priorities and industry-leading dividend framework, which has returned over $4.5 billion to shareholders since established in October 2020
The Scheme is unanimously recommended by the Board of Directors of Newcrest, subject to no superior proposal emerging for Newcrest and the Independent Expert concluding that the transaction is in the best interests of Newcrest shareholders
The Board of Newmont unanimously recommends6 that Newmont stockholders vote in favor of the required Newmont stockholder resolution
Transaction is subject to customary conditions, including shareholder approval, with completion expected in the fourth quarter of 2023
Newmont will host investor webcast and conference call on May 15, 2023 at 8:00 a.m. Eastern Daylight Time (10:00 p.m. Australian Eastern Standard Time)
DENVER--(BUSINESS WIRE)-- Newmont Corporation (NYSE: NEM, TSX: NGT) today announced that following completion of due diligence it has entered into a binding Scheme Implementation Deed (“SID”) under which Newmont will acquire 100 percent of the issued share capital in Newcrest by way of an Australian court-approved Scheme of Arrangement (the “Scheme” or the “Transaction”).

“The combination of Newmont and Newcrest represents an exceptional value proposition for shareholders and other stakeholders. It creates an industry-leading portfolio with a multi-decade gold and copper production profile in the world’s most favorable mining jurisdictions,” said Tom Palmer, President and CEO of Newmont. “Following a robust due diligence process, we have identified a number of opportunities to unlock substantial value and will apply our experience and expertise to Newcrest’s complementary and exceptional portfolio of long-life, low-cost gold and copper assets. Leveraging our experience from the acquisition of Goldcorp four years ago, we are positioned to deliver an estimated $500 million in annual synergies and an estimated $2 billion in incremental cash flow from portfolio optimization opportunities, both part of our strategy to maximize value for shareholders and other stakeholders.”

Mr. Palmer continued: “This transaction also increases Newmont’s annual copper production – a metal vital for the new energy economy – and adds nearly 50 billion pounds of copper reserves and resources from Newcrest to our robust and balanced portfolio7. We intend to quickly realize these opportunities to create superior value for our shareholders, workforce, host communities and governments.”

Newcrest’s Chairman, Peter Tomsett, added: “This transaction combines two of the world’s leading gold producers, bringing forward significant value to Newcrest shareholders through the recognition of our outstanding growth pipeline. In addition to the ongoing benefits of merging these premier portfolios, the combined group will set a new benchmark in gold production while benefitting from a material and growing exposure to copper and a market leading position in safety and sustainability. The Newcrest Board is unanimously recommending the proposal. We are very proud of the entire Newcrest team for building a world class metals business, which will form a key part of the combined group. We believe our shareholders and other stakeholders can look forward to an exciting and prosperous future.”


The New Sustainability Standard

For the last eight years, Newmont has been recognized as the top gold miner in the Dow Jones Sustainability Index, and regularly ranks as the most transparent company for sustainability disclosure in the S&P 500. Beyond Newcrest’s well-established sustainability credentials and top quartile industry ranking, Newmont will apply its proven sustainability practices and leadership to Newcrest’s assets by:

Bringing a clear focus on mitigating safety risks along with visible, felt leadership in the field to drive a fatality-free business
Building on Newmont’s sustainability leadership and commitment to meaningful social engagement based on inclusion, transparency and integrity in order to be the partner of choice for governments, host communities, suppliers and workforce
Remaining committed to Newmont’s leading environmental stewardship practices and climate goals
Creating a diverse, inclusive and equitable workplace where everyone is welcome, attracting and retaining the breadth of skills and innovation needed to continuously improve performance
World-Class Portfolio

This acquisition would create a world-class portfolio of assets with the highest concentration of Tier 1 operations, primarily in favorable, low-risk mining jurisdictions. Supported by this portfolio, Newmont will be well-positioned to generate strong, stable and lasting returns with best-in-class sustainability performance, well into the future.

Through the combination of high-quality operations, projects and reserves, this portfolio is expected to deliver:

Outstanding depth and breadth of global production focused across stable mining jurisdictions:8
Approximately 8 million ounces of total combined annual gold production upon closing the Transaction, with more than 5 million gold ounces, or two-thirds of total gold production, from 10 large, long-life, low cost, Tier 1 assets
Combined annual copper production of approximately 350 million pounds from Australia and Canada
An extensive portfolio of greenfield and brownfield growth options from the industry’s largest reserve and resource base:
96 million ounces of gold reserves declared by Newmont and 52 million ounces declared by Newcrest, along with 111 million and 68 million ounces of gold resources, respectively9
Significant majority of combined entity’s gold reserves will be located in the Americas and Australia
Value-generating projects across some of the world’s most prospective regions including Canada’s Golden Triangle
Meaningful increase in copper reserves, a critical metal in facilitating the transition to a new energy economy
Maintaining a disciplined approach to mine planning and project development at reserve gold pricing, creating a resilient business to maximize long-term returns
Delivering Synergies

The combined business would be immediately supported by Newmont’s scalable, integrated operating model with a deep bench of experienced leaders, subject matter experts and existing regional teams in Australia and Canada. Building on the experience gained following the acquisition of Goldcorp, Newmont has identified the opportunity for substantial synergies:

$500 million of total annual pre-tax synergies anticipated to be achieved within the first 24 months following the completion of the Transaction:
Approximately $100 million of pre-tax general and administrative synergies driven by Newmont’s scalable, integrated operating model with existing regional teams in Australia and Canada
Approximately $200 million of supply chain synergies from best-in-class pricing and existing strong partnerships with key suppliers, smelters and equipment manufacturers through unprecedented economies of scale
At least $200 million of benefits from Newmont’s proven Full Potential continuous improvement program, which improves costs and productivity through the rapid replication of leading processes and advanced technology10
Further value creation opportunities are anticipated as the Newcrest portfolio is fully integrated into Newmont, bringing together the industry’s best talent and processes across two key mining jurisdictions, including, among other things, the benefits from the experience of Newcrest’s world-class block caving team.


The Transaction brings together two of Australia’s largest gold producers and would reinforce Newmont’s long-standing commitment to safe, profitable and responsible gold and copper production in the country for decades to come.

Newmont will leverage its existing regional operating model in Australia and, following the Transaction, will combine and optimize both companies’ leaders, subject matter experts, supply chains and regional infrastructure to drive best-in-class performance.

Newmont intends to apply for a foreign exempt listing on the Australian Securities Exchange (“ASX”) and establish Clearing House Electronic Sub-register System Depositary Interests (“CDIs”) on the ASX. Newcrest shareholders may elect to receive CDIs representing a unit of beneficial ownership in Newmont common stock based on their country of residence.

Papua New Guinea

Upon closing of the Transaction, Newmont will establish a regional presence and in-country offices in Papua New Guinea, committed to building and maintaining strong, proactive and mutually beneficial relationships with host governments and local communities while supporting safe and profitable operations.


Once complete, the Transaction will solidify Newmont’s position in Canada through the combination of operating mines and development projects, creating a Tier 1 district in British Columbia’s highly-prospective Golden Triangle.

The combination will also leverage Newmont’s existing regional operating model in North America to combine and optimize both company’s leaders, subject matter experts, supply chains and regional infrastructure to drive best-in-class performance.

Looking ahead, the Company’s expanded footprint in Canada, together with shared ore body experience and technical expertise, could unlock gold and copper opportunities from the combined organic project pipeline, including the key projects Galore Creek and Saddle North.

Newmont will maintain its current listing on the TSX following closing of the Transaction.

Driving Capital Allocation
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