Newmont Gold and Goldcorp merger finalized

April 23, 2019

Newmont Goldcorp Corporation announced the successful conclusion of its transaction combining Newmont Mining Corp. and Goldcorp Inc. to form the world’s leading gold business.

The resulting company features a portfolio of assets, prospects and talent that includes long-life operations and profitable expansion and exploration options in some of the world’s most favorable mining jurisdictions. Newmont Goldcorp will also offer investors the highest annual dividend and the largest reserves and resources per share among senior gold producers.

“We’ve met our goal to become the world’s leading gold business, and we’ll maintain that position by executing our winning strategy,” said Gary J. Goldberg, chief executive officer. “That strategy focuses on constantly improving safety and efficiency at our current operations while we continue to invest in expansions and exploration to fuel next generation production. An equally important part of that strategy is to meet stakeholders’ expectations by continuing to lead the sector in value creation and sustainability performance.”

Tom Palmer, president and chief operating officer, added, “Our proven operating model and shared values set the stage for a successful integration process. Getting this process right is fundamental to realizing the full potential of the Newmont Goldcorp combination. Ultimately, our goal is to leverage a more prolific portfolio and an even richer talent pool to generate superior value over the course of decades.”

The deal, the biggest takeover in the gold sector’s history, according to Refinitiv data, faced some initial opposition from Newmont investors who said it overly favored Goldcorp shareholders. But they rallied behind the proposal on the promise of a special dividend.

Newmont Goldcorp, will overtake current market leader Barrick Gold Corp. in annual production, churning out 170 to 198 t/a (6 million to 7 million ozpy) of gold over the next 10 years, compared with Barrick’s forecast of 144 to 158 t/a (5.1 million to 5.6 million oz) for 2019.

Newmont Goldcorp expects to shed between $1 billion and $1.5 billion of assets to focus on its most promising operations. This, combined with mines Barrick plans to sell in the wake of its acquisition of Randgold Resources, is expected by analysts to fuel a flurry of deals in a sector that has been focused on cutting costs rather than pursuing growth for several years.

Newmont’s acquisition of Goldcorp had faced several hurdles, beginning with Barrick’s hostile takeover bid for Newmont in February, which required it to abandon its deal with Goldcorp.

That was resolved through the creation of a joint venture of Newmont and Barrick’s operations in Nevada, which was estimated to create $4.7 billion in synergies.



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