(Bloomberg) — Newmont Corp. has made an interim offer to acquire leading Australian gold miner Newcrest Mining Ltd. in the largest global acquisition of the year to date.
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The offer, which values Newcrest at around $17 billion, would also be one of the largest in Australian history, according to data compiled by Bloomberg. Newcrest rallied as much as 14% in early trading, its highest level since 2008.
Shareholders will receive 0.38 Newmont shares for each Newcrest share held, equivalent to AU$27.16 a share or 21% premium until Friday’s close, the company said. Melbourne-based mining company said in a regulatory filing on Monday. Newcrest said the board is considering the proposal, provided that Newmont be granted exclusive review.
Denver-based Newmont, one of the world’s largest gold miners with a market value of nearly $40 billion, made its bid earlier with an exchange rate of 0.363, but the board of Newcrest declined.
In September, Newmont delayed a major investment decision in Peru until the second half of 2024, citing Russia’s war in Ukraine, soaring raw material prices, prolonged supply chain disruptions and market disruptions. competitive labor. Spot gold is up about 15% since early November while copper is up nearly 20%.
Bloomberg Intelligence analyst Mohsen Crofts said in a report on Monday: “The strong Australian dollar, gold prices and falling global reserves suggest more buybacks are likely, particularly in for businesses like Newcrest, which has significant copper exposure.”
The approach comes as Newcrest is looking for a new chief executive officer following the resignation of Sandeep Biswas in December. Sherry Duhe, the former chief financial officer of oil and gas producer Woodside Energy Group Ltd., will keep Acting CEO until a permanent replacement is found.
Newcrest derives most of its revenue from gold and the rest from silver and copper, with mines in Australia, Canada and Papua New Guinea. In an interview in November, Duhe said the company plans to ramp up its copper component to take advantage of the expected surge in demand for the metal as a core material in its renewable energy infrastructure. generating and electric vehicles.
Newcrest invited JP Morgan Chase & Co. and Gresham Advisory Partners Ltd. as financial advisor and Herbert Smith Freehills as legal counsel.
–With assistance from Harry Brumpton.
(Updated with transparency details)
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