Newmont Mining Corporation (NYSE: NEM) (Newmont or the Company)
and Goldcorp Inc. (NYSE: GG, TSX: G) (Goldcorp) today announced
that Goldcorp has obtained an interim order from the Ontario
Superior Court of Justice (Commercial List) in connection with the
previously announced statutory arrangement for the acquisition by
Newmont of all of the issued and outstanding common shares of
Goldcorp in exchange for 0.3280 of a share of Newmont common stock
and $0.02 in cash for each Goldcorp common share in a transaction
valued at approximately $10 billion as of the date of announcement
of the transaction. Receipt of the interim order allows Goldcorp to
hold its shareholder meeting on April 4, 2019 and is a necessary
step toward obtaining a final order from the Court that is a
condition to closing the acquisition.
The combination of the two companies will create an unmatched
portfolio of world-class operations, projects, Reserves,
exploration opportunities, and talent. On day one after the
transaction closes, which is expected in the second quarter,
Newmont Goldcorp will:
- Be immediately value-accretive to
Newmont’s Net Asset Value and cash flow per share;(1)
- Generate an estimated $75 per ounce in
Full Potential cost and efficiency improvements, representing
annual anticipated benefits of approximately $165 million per
year;(4)
- Create a combined $265 million in
expected annual pre-tax synergies and Full Potential benefits
representing value creation potential of over $2.5 billion;(5)
- Target 6-7 million ounces of
steady-state gold production over a decades-long time
horizon;(1)
- Have the largest gold Reserves and
Resources in the gold sector, including on a per share basis;
- Be located in favorable mining
jurisdictions and prolific gold districts on four continents;
- Deliver the highest dividend among
senior gold producers;(2)
- Offer financial flexibility and an
investment-grade balance sheet to advance the most promising
projects generating a targeted Internal Rate of Return of at least
15 percent;(1)(3)
- Feature a deep bench of accomplished
business leaders and high-performing technical teams and other
talent with extensive mining industry experience; and
- Maintain industry leadership in
environmental, social and governance performance.
About Newmont
Newmont is a leading gold and copper producer. The Company’s
operations are primarily in the United States, Australia, Ghana,
Peru and Suriname. Newmont is the only gold producer listed in the
S&P 500 Index and was named the mining industry leader by the
Dow Jones Sustainability World Index in 2015, 2016, 2017 and 2018.
The Company is an industry leader in value creation, supported by
its leading technical, environmental, social and safety
performance. Newmont was founded in 1921 and has been publicly
traded since 1925.
About Goldcorp
Goldcorp is a senior gold producer focused on responsible mining
practices with safe, low-cost production from a high-quality
portfolio of mines.
Cautionary Statement Regarding Forward-Looking
Statements:
This release contains “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended,
which are intended to be covered by the safe harbor created by such
sections and other applicable laws and “forward-looking
information” within the meaning of applicable Canadian securities
laws. Where a forward-looking statement expresses or implies an
expectation or belief as to future events or results, such
expectation or belief is expressed in good faith and believed to
have a reasonable basis. However, such statements are subject to
risks, uncertainties and other factors, which could cause actual
results to differ materially from future results expressed,
projected or implied by the forward-looking statements.
Forward-looking statements often address our expected future
business and financial performance and financial condition, and
often contain words such as “anticipate,” “intend,” “plan,” “will,”
“would,” “estimate,” “expect,” “believe,” “target,” “indicative,”
“preliminary,” or “potential.” Forward-looking statements in this
release may include, without limitation: (i) statements
relating to Newmont’s planned acquisition of Goldcorp (the
“proposed transaction”) and the expected terms, timing and closing
of the proposed transaction, including receipt of required
approvals and satisfaction of other customary closing conditions;
(ii) estimates of future production and sales, including
expected annual production range; (iii) estimates of future
costs applicable to sales and all-in sustaining costs;
(iv) expectations regarding accretion; (v) estimates of
future capital expenditures; (vi) estimates of future cost
reductions, efficiencies and synergies; (vii) expectations
regarding future exploration and the development, growth and
potential of Newmont’s and Goldcorp’s operations, project pipeline
and investments, including, without limitation, project returns,
expected average IRR, schedule, decision dates, mine life,
commercial start, first production, capital average production,
average costs and upside potential; (viii) expectations
regarding future investments or divestitures; (ix) expectations of
future dividends and returns to shareholders; (x) expectations
of future free cash flow generation, liquidity, balance sheet
strength and credit ratings; (xi) expectations of future
equity and enterprise value; and (xii) expectations of future
plans and benefits; (xiii) expectations regarding future
mineralization, including, without limitation, expectations
regarding reserves and resources, grade and recoveries; and
(xiv) estimates of future closure costs and liabilities.
Estimates or expectations of future events or results are based
upon certain assumptions, which may prove to be incorrect. Such
assumptions, include, but are not limited to: (i) there being no
significant change to current geotechnical, metallurgical,
hydrological and other physical conditions; (ii) permitting,
development, operations and expansion of Newmont’s and Goldcorp’s
operations and projects being consistent with current expectations
and mine plans, including without limitation receipt of export
approvals; (iii) political developments in any jurisdiction in
which Newmont and Goldcorp operate being consistent with its
current expectations; (iv) certain exchange rate assumptions for
the Australian dollar or the Canadian dollar to the U.S. dollar, as
well as other exchange rates being approximately consistent with
current levels; (v) certain price assumptions for gold, copper,
silver, zinc, lead and oil; (vi) prices for key supplies being
approximately consistent with current levels; (vii) the accuracy of
current mineral reserve, mineral resource and mineralized material
estimates; and (viii) other planning assumptions. Risks relating to
forward-looking statements in regard to Newmont and Goldcorp’s
business and future performance may include, but are not limited
to, gold and other metals price volatility, currency fluctuations,
operational risks, increased production costs and variances in ore
grade or recovery rates from those assumed in mining plans,
political risk, community relations, conflict resolution
governmental regulation and judicial outcomes and other risks. In
addition, material risks that could cause actual results to differ
from forward-looking statements include: the inherent uncertainty
associated with financial or other projections; the prompt and
effective integration of Newmont’s and Goldcorp’s businesses and
the ability to achieve the anticipated synergies and value-creation
contemplated by the proposed transaction; the risk associated with
Newmont’s and Goldcorp’s ability to obtain the approval of the
proposed transaction by their shareholders required to consummate
the proposed transaction and the timing of the closing of the
proposed transaction, including the risk that the conditions to the
transaction are not satisfied on a timely basis or at all and the
failure of the transaction to close for any other reason; the risk
that a consent or authorization that may be required for the
proposed transaction is not obtained or is obtained subject to
conditions that are not anticipated; the outcome of any legal
proceedings that may be instituted against the parties and others
related to the arrangement agreement; unanticipated difficulties or
expenditures relating to the transaction, the response of business
partners and retention as a result of the announcement and pendency
of the transaction; potential volatility in the price of Newmont
Common Stock due to the proposed transaction; the anticipated size
of the markets and continued demand for Newmont’s and Goldcorp’s
resources and the impact of competitive responses to the
announcement of the transaction; and the diversion of management
time on transaction-related issues. For a more detailed discussion
of such risks and other factors, see Newmont’s 2018 Annual Report
on Form 10-K, filed with the Securities and Exchange Commission
(SEC) as well as the Company’s other SEC filings, available on the
SEC website or www.newmont.com, Goldcorp’s most recent annual
information form as well as Goldcorp’s other filings made with
Canadian securities regulatory authorities and available on SEDAR,
on the SEC website or www.goldcorp.com. Newmont is not affirming or
adopting any statements or reports attributed to Goldcorp
(including prior mineral reserve and resource declaration) in this
release or made by Goldcorp outside of this release. Goldcorp is
not affirming or adopting any statements or reports attributed to
Newmont (including prior mineral reserve and resource declaration)
in this release or made by Newmont outside of this release. Newmont
and Goldcorp do not undertake any obligation to release publicly
revisions to any “forward-looking statement,” including, without
limitation, outlook, to reflect events or circumstances after the
date of this release, or to reflect the occurrence of unanticipated
events, except as may be required under applicable securities laws.
Investors should not assume that any lack of update to a previously
issued “forward-looking statement” constitutes a reaffirmation of
that statement. Continued reliance on “forward-looking statements”
is at investors’ own risk.
Additional information about the proposed transaction and
where to find it
This release is not intended to and does not constitute an offer
to sell or the solicitation of an offer to subscribe for or buy or
an invitation to purchase or subscribe for any securities or the
solicitation of any vote or approval in any jurisdiction, nor shall
there be any sale, issuance or transfer of securities in any
jurisdiction in contravention of applicable law. This release is
being made in respect of the proposed transaction involving the
Company and Goldcorp pursuant to the terms of an Arrangement
Agreement by and among the Company and Goldcorp and may be deemed
to be soliciting material relating to the proposed transaction. In
connection with the proposed transaction, the Company will file a
proxy statement relating to a special meeting of its stockholders
with the SEC. Additionally, the Company will file other relevant
materials in connection with the proposed transaction with the SEC.
Security holders of the Company are urged to read the proxy
statement regarding the proposed transaction and any other relevant
materials carefully in their entirety when they become available
before making any voting or investment decision with respect to the
proposed transaction because they will contain important
information about the proposed transaction and the parties to the
transaction. The definitive proxy statement will be mailed to the
Company’s stockholders. Stockholders of the Company will be able to
obtain a copy of the proxy statement, the filings with the SEC that
will be incorporated by reference into the proxy statement as well
as other filings containing information about the proposed
transaction and the parties to the transaction made by the Company
with the SEC free of charge at the SEC’s website at www.sec.gov, on
the Company’s website at
www.newmont.com/investor-relations/default.aspx or by contacting
the Company’s Investor Relations department at
jessica.largent@newmont.com or by calling 303-837-5484. Copies of
the documents filed with the SEC by Goldcorp will be available free
of charge at the SEC’s website at www.sec.gov.
Participants in the proposed transaction solicitation
The Company and its directors, its executive officers, members
of its management, its employees and other persons, under SEC
rules, may be deemed to be participants in the solicitation of
proxies of the Company’s stockholders in connection with the
proposed transaction. Investors and security holders may obtain
more detailed information regarding the names, affiliations and
interests of certain of the Company’s executive officers and
directors in the solicitation by reading the Company’s 2018 Annual
Report on Form 10-K filed with the SEC on February 21, 2019, its
proxy statement relating to its 2018 Annual Meeting of Stockholders
filed with the SEC on March 9, 2018 and other relevant materials
filed with the SEC when they become available. Additional
information regarding the interests of such potential participants
in the solicitation of proxies in connection with the proposed
transaction will be set forth in the proxy statement filed with the
SEC relating to the transaction when it becomes available.
Additional information concerning Goldcorp’s executive officers and
directors is set forth in its 2017 Annual Report on Form 40-F filed
with the SEC on March 23, 2018, its management information circular
relating to its 2018 Annual Meeting of Stockholders filed with the
SEC on March 16, 2018 and other relevant materials filed with the
SEC when they become available.
(1) Caution Regarding Projections: Projections used in this
release are considered “forward looking statements”. See cautionary
statement above regarding forward-looking statements.
Forward-looking information representing post-closing expectations
is inherently uncertain. Estimates such as expected accretion,
expected future production, internal rate of return, financial
flexibility and balance sheet strength are preliminary in nature.
There can be no assurance that the proposed transaction will close
or that the forward-looking information will prove to be accurate.
(2) 2019 dividends beyond Q4 2018 have not yet been approved or
declared by the Board of Directors. Management’s expectations with
respect to future dividends or annualized dividends are
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, which are intended to
be covered by the safe harbor created by such sections and other
applicable laws. Investors are cautioned that such statements with
respect to future dividends are non-binding. The declaration and
payment of future dividends remain at the discretion of the Board
of Directors and will be determined based on Newmont’s financial
results, balance sheet strength, cash and liquidity requirements,
future prospects, gold and commodity prices, and other factors
deemed relevant by the Board. The Board of Directors reserves all
powers related to the declaration and payment of dividends.
Consequently, in determining the dividend to be declared and paid
on the common stock of the Company, the Board of Directors may
revise or terminate the payment level at any time without prior
notice. As a result, investors should not place undue reliance on
such statements. (3) Internal rates of return targets on projects,
before taxes and royalties, are calculated using an assumed $1,200
gold price. (4) Full Potential cost savings or improvements as used
in this presentation are considered operating measures provided for
illustrative purposes, and should not be considered GAAP or
non-GAAP financial measures. Full Potential amounts are estimates
utilized by management that represent estimated cumulative
incremental value realized as a result of Full Potential projects
implemented and are based upon both cost savings and efficiencies
that have been monetized for purposes of the estimation. Because
Full Potential savings/improvements estimates reflect differences
between certain actual costs incurred and management estimates of
costs that would have been incurred in the absence of the Full
Potential program, such estimates are necessarily imprecise and are
based on numerous judgments and assumptions. Expected Full
Potential cost savings or improvements are projections are
“forward-looking statements” subject to risks, uncertainties and
other factors which could cause actual results to differ from
current expectations. (5) Value creation potential as used in this
presentation is a management estimate provided for illustrative
purposes, and should not be considered a GAAP or non-GAAP financial
measure. Value creation potential represents management’s estimate
of cost savings and improvements as the result of the Full
Potential program and synergies as a result of the proposed
transaction that have been monetized and projected over a twenty
year period for purposes of the estimation, applying a discount
rate of 7%. Such estimates are necessarily imprecise and are based
on numerous judgments and assumptions. Expected value creation
potential is a “forward-looking statement” subject to risks,
uncertainties and other factors which could cause actual value
creation to differ from expected value creation.
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version on businesswire.com: https://www.businesswire.com/news/home/20190222005498/en/
NewmontMedia ContactOmar
Jabara303.837.5114omar.jabara@newmont.comorInvestor ContactJessica
Largent303.837.5484jessica.largent@newmont.com
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