In a move to combine two of the top senior gold producers, U.S.-based Newmont has submitted a non-binding proposal to acquire 100% of the issued share capital of Australian peer Newcrest Mining by way of a scheme of arrangement.
If successful, it would be the largest mining takeover and the third-largest corporate buyout in Australian history, according to Refinitiv data. The newly combined company would produce nearly twice as much gold as closest rival Barrick Gold.
Newmont’s $16.9 billion offer is on the basis of 0.38 Newmont shares per Newcrest share, giving Newcrest shareholders a 30% stake in the company.
“We believe a combination of Newmont and Newcrest presents a powerful value proposition to our respective shareholders, workforce and the communities in which we operate,” said Tom Palmer, president and CEO of Newmont.
“The proposed transaction would join industry-leading portfolios of assets and projects to create long-term value across the combined global business, and we welcome the consideration of Newcrest’s board of directors.”
Newcrest, which was spun out of Newmont in the 1990s, has said it is considering the proposal. The miner’s assets include the Cadia gold-copper operation in New South Wales, Australia; Brucejack gold-silver and Red Chris gold-copper mines in British Columbia, Canada; Lihir gold mine in Papua New Guinea; and the Telfer gold-copper mine in Western Australia.