As Newmont Mining continues to proceed with its $10bn takeover deal of gold-miner Goldcorp, in a shock move, rival Barrick Gold instigated a hostile $18bn takeover bid of Newmont. Heidi Vella takes a look at the potential combinations and their possible impact on the North American gold mining sector.
As 2019 kicked-off, Colorado-based Newmont and Canadian-based Goldcorp announced the two companies had struck a deal to merge, in a move that would see them become one of the biggest mining firms in the world. The following month, the firms’ consolidation overcame its first hurdle after it was approved by both Canadian and Korean regulators.
However, in a surprise move in February, Newmont received an acquisition proposal from Canadian-based mining behemoth Barrick – one of the largest gold mining companies in the world.
After receiving an initial rebuttal from Newmont, Barrick, which already owns a thousand shares in Newmont, said it is considering making an all-stock bid for the company. If successful the deal would create a gold company with a staggering value around $42bn.
A tale of two mergers
During a conference call with journalists shortly after Barrick announced its intentions regarding Newmont, the company’s CEO, Mark Bristow, said he sees the potential merger as an opportunity with ‘strategic and economic rational [that] is so obvious and compelling’.
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