Newmont Mining to take over Goldcorp in US$10-billion acquisition deal – by Niall McGee and Rachelle Younglai (Globe and Mail – January 15, 2019)

Goldcorp Inc. has agreed to a US$10-billion takeover by Newmont Mining Corp. that sees the Vancouver company, once the world’s most valuable gold miner, acquired by a U.S. competitor at a fraction of its peak value.

The Goldcorp takeover is the second big deal in the past few months involving a large Canadian gold company. On Jan. 1, Toronto-based Barrick Gold Corp. closed its US$6-billion acquisition of African operator Randgold Resources Ltd.

Now, Newmont is set to surpass Barrick and grab the crown as the world’s largest gold producer by market capitalization, production and reserves. Newmont and Goldcorp will produce 6 to 7 million ounces of gold a year over the next decade, executives said on Monday. The combined stock market capitalization of the new company would be about $35-billion, compared with Barrick’s $29-billion.

Newmont chief executive Gary Goldberg said the deal creates a giant company with 20 mines that “combines world-class assets and prospects in favourable mining jurisdictions,” and the opportunity to save US$100-million in annual costs.

“This is not a deal we have to do,” he said. “This is a deal that we want to do.” Goldcorp joins a long list of Canadian miners to be scooped up by foreign acquirers over the past 15 years. Many of Canada’s largest base metals companies, including Inco, Alcan and Falconbrige, were acquired in the mid-2000s, and Barrick’s recent acquisition of Randgold has amounted to a reverse takeover of sorts, with the company since unveiling deep cuts at its Toronto head office.

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