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Newmont says shareholders to get special payout if Goldcorp takeover approved – by Niall McGee (Globe and Mail – March 25, 2019)

https://www.theglobeandmail.com/

Newmont Mining Corp. intends to pay its shareholders a one-time dividend worth US$470-million after a number of large investors pushed for the giant miner to renegotiate terms of its takeover of Goldcorp Inc.

Newmont shareholders who own stock as of April 17 will be entitled to US$0.88 per share. The dividend is payable only if shareholders on both sides approve Newmont’s US$10-billion takeover of Goldcorp.

Last week, Paulson & Co said Newmont should pay about 23 per cent less for Goldcorp in light of its recent joint venture (JV) agreement with Barrick Gold Corp. The hedge fund argued that the JV had materially increased the value of Newmont and as a result it should pay less of its own stock for Goldcorp.

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Paulson says will not support Newmont takeover bid for Goldcorp (Reuters U.S. – March 21, 2019)

https://www.reuters.com/

TORONTO (Reuters) – Paulson & Co Inc will not support Newmont Mining Corp’s planned $10 billion takeover of rival Goldcorp Inc as the premium offered is unjustified, the investor said in a letter on Thursday.

The transaction is dilutive to Newmont shareholders and only Goldcorp shareholders would benefit from the deal’s synergies, Founder John Paulson and Partner Marcelo Kim said in the letter to Newmont Chief Executive Officer Gary Goldberg.

Newmont made a friendly offer in January for Goldcorp in what would be the gold sector’s biggest-ever takeover transaction, a bid to create the world’s largest gold producer.

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Golden executive payoffs hurt shareholders and economy – by Ian Madsen (Troy Media – March 19, 2019)

https://troymedia.com/

Ian Madsen is a senior policy analyst with the Frontier Centre for Public Policy.

The Goldcorp Inc. merger with Newmont Mining Corp. has many people bemoaning the loss of yet another large, independent Canadian company to an opportunistic acquirer.

With the consequent loss of many Goldcorp executive and other head office jobs, the real tragedy is that too many Canadian companies have aimless, dysfunctional, or outright bad managers who rarely face the ramifications of their poor decisions.

Its not just left-leaning people who are frustrated with those at the top receiving enormous salaries, bonuses, performance incentives, stock options and other emoluments. So do professional, institutional and ordinary shareholders.

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Bristow’s masterstroke gives Barrick control of Newmont’s Nevada assets — but now he must deliver – by Gabriel Friedman (Financial Post – March 16, 2019)

https://business.financialpost.com/

Barrick CEO Mark Bristow says investor’s poor reaction to the Newmont-Goldcorp merger created an opportunity and he pounced

One day after announcing a deal to effectively create the world’s third largest gold company, Mark Bristow, chief executive of Barrick Gold Corp., stayed in Elko, Nevada — a dry, rugged city situated near the Carlin Trend, one of the world’s richest gold mining districts — to assemble the team responsible for executing his promises.

For decades, Toronto-based Barrick Gold Corp. and its archrival Colorado-based Newmont Mining Corp., the two biggest gold mining companies in the world, have fuelled a large part of their growth through discoveries along the Carlin Trend, and tried numerous times to reach an accord to work together there.

Now, Bristow, 12 weeks into his tenure at the helm of Barrick, is holding up a joint venture agreement with Newmont to share assets in Nevada, which he claims will save both companies US$500 million per year, and billions of dollars over the long run. What’s more the deal was ramrodded through in a matter of days while Bristow proposed a $17.8 billion hostile offer to takeover all of Newmont.

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Barrick drops $18-billion hostile bid, signs Nevada joint venture with Newmont Mining – by Niall McGee and Rachelle Younglai (Globe and Mail – March 12, 2019)

https://www.theglobeandmail.com/

Barrick Gold Corp. and Newmont Mining Corp. have agreed to team up in a joint venture in Nevada that will see Barrick drop its hostile bid for its biggest rival and unite the world’s two biggest gold miners in one of the richest goldfields on the planet.

The accord means Colorado-based Newmont is far more likely to succeed in its efforts to buy Goldcorp Inc. and bypass Barrick as the world’s biggest gold company. Barrick’s pursuit of Newmont had threatened to derail the US$10-billion deal that was announced in January.

The Barrick-Newmont ownership split announced on Monday will be 61.5 per cent in favour of Barrick with the Toronto-based miner also named as the operator. The agreement will see gigantic mines, including Barrick’s Goldstrike and Cortez operations, along with Newmont’s Carlin, unite under one roof.

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Gold Miners Don’t Quite Put a Ring on It – by Liam Denning (Bloomberg News – March 11, 2019)

https://www.bloomberg.com/

Barrick and Newmont finally strike a deal, but it won’t move the needle much.

It’s amazing what just talking it out can achieve. After a parade of insults, suspect numbers and pitch decks, Barrick Gold Corp. and Newmont Mining Corp. have agreed to a deal.

It isn’t the deal Barrick originally pushed for; namely, a hostile full takeover of its rival. Instead, they will holster their Excel models and form a partnership in the one asset anyone really cares about: their Nevada mining operations.

On balance, it looks as if Barrick got most of what it wanted. It will run the Nevada joint venture and control three of the five board seats governing it. Ownership of 61.5 percent reflects Barrick’s much bigger resource base in the region (as my colleague David Fickling laid out here), with Newmont giving ground on its earlier proposal of a 55/45 split.

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Barrick Withdraws $17.8 Billion Hostile Bid for Newmont – by Joseph Richter and Danielle Bochove (Bloomberg News – March 11, 2019)

https://www.bloomberg.com/

Barrick Gold Corp. is withdrawing its $17.8 billion hostile takeover bid for Newmont Mining Corp., with the companies opting instead to forge a joint venture around their Nevada projects.

The change came weeks after Barrick proposed an all-share offer that would have created the world’s largest gold producer. After Newmont’s board rejected the bid, Newmont Chief Executive Officer Gary Goldberg proposed the joint venture as an alternative both companies could gain from.

Barrick’s decision ends two weeks of animosity between the gold producers, and helps Newmont focus on securing shareholder approval for its previously announced offer to buy Goldcorp Inc. Newmont raised doubts about the Barrick bid from the start, saying its Goldcorp move offered better benefits.

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Why Barrick wants to merge with Newmont: Gold is harder to find and mining it is more expensive – by Gabriel Friedman (Financial Post – March 6, 2019)

https://business.financialpost.com/

Barrick Gold Corp.’s sudden expansionist desires are driven by the same concerns as the rest of the industry — it’s getting harder to find gold and more expensive to mine it, according to John McCluskey chief executive of Alamos Gold Inc.

Barrick is pursuing a $17.8-billion hostile bid for its arch rival, Newmont Mining Corp., in a deal that would combine the two largest gold companies into a firm of unparalleled size.

If successful, it would have numerous consequences for the rest of the gold industry, potentially laying the groundwork for future asset sales and consolidation, and also potentially pulling new generalist investors into the high-risk, high-reward precious metals sector.

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Barrick, Newmont work toward joint-venture deal – by Niall McGee and Rachelle Younglai (Globe and Mail – March 6, 2019)

https://www.theglobeandmail.com/

The chief executives of Barrick Gold Corp. and Newmont Mining Corp. are working to reach agreement on a critical joint-venture deal that could stave off a high-stakes takeover battle, but deep divisions remain between the world’s largest gold producers.

Barrick CEO Mark Bristow and Newmont CEO Gary Goldberg were scheduled to meet in New York on Tuesday evening to discuss terms of a possible joint venture (JV) at their adjacent Nevada mining operations, according to a source familiar with the talks who was not authorized to speak publicly. Major shareholders of both companies are urging executives to solve long-standing disagreements over the proposal.

Newmont on Monday rejected Barrick’s US$17.8-billion all-stock, zero premium takeover offer, and instead proposed a joint-venture agreement in Nevada between the two companies. Newmont proposed an ownership split of 55 per cent in favour of Barrick with both companies sharing management responsibilities.

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Newmont CEO Eager to Meet with Barrick But Not About Merger – by Danielle Bochove and Ed Hammond (Bloomberg News – March 5, 2019)

https://www.bloomberg.com/

After more than a week of tough talk firing back and forth, the leaders of the two biggest gold producers are finally coming to the table.

Newmont Mining Corp. Chief Executive Officer Gary Goldberg said he will be meeting with Barrick Gold Corp.’s Mark Bristow later Tuesday in New York to talk through their differences. However, he said in a Bloomberg TV interview that he won’t be discussing Barrick’s bid for his company, but rather Newmont’s proposal for a joint venture around the two companies’ assets in Nevada.

Goldberg said he heard from Bristow earlier and that “I’m looking forward to catching up with him later today here in New York. This will be the discussion on the joint venture with what we proposed yesterday.’’ Barrick spokeswoman Kathy du Plessis didn’t immediately have a comment.

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What Humphrey Bogart Can Teach the Gold Diggers – by David Fickling (Bloomberg News – March 5, 2019)

https://www.bloomberg.com/

Barrick and Newmont have far more to gain from cooperating than bickering with each other. Here’s one way to get past their squabbles.

In the classic John Huston film “Treasure of the Sierra Madre,” a group of gold prospectors strike it rich before squandering their good fortune in a tangle of greed, distrust, murder and paranoia.

Something similar is happening to Barrick Gold Corp. and Newmont Mining Corp. in Nevada. Disagreements about how to manage and develop what’s arguably the world’s best-endowed area of gold deposits look set to ensure that both companies continue in an awkward and bad-tempered cohabitation, rather than growing rich together.

Every parent who’s dealt with siblings yelling “Mine!” at each other knows the way to end this sort of squabble: Take away the toys. As it happens, that might be a way to solve this fight.

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OPINION: Newmont’s combative counterattack does not mean Barrick Gold is defeated – by Eric Reguly (Globe and Mail – March 5, 2019)

https://www.theglobeandmail.com/

Barrick Gold’s lunge for Newmont Mining has officially gone hostile, extremely so, with Newmont formally rejecting the Canadian company’s US$17.8-billion offer and blasting its executive chairman, John Thornton, for shabby performance. But this is not the end of the story – don’t count Barrick out just yet.

On Monday, as expected, Newmont, America’s biggest gold company, told Barrick to hit the road. Its all-share, nil-premium offer, revealed on Feb. 25, was a non-starter, Newmont said in its presentation, arguing that Newmont’s proposed US$10-billion takeover of Vancouver’s Goldcorp was less risky and would create ample value for shareholders.

Newmont and its CEO, Gary Goldberg, lashed out at both Mr. Thornton and Barrick CEO Mark Bristow, though it was Mr. Thornton, the former Goldman Sachs boss who replaced the late Peter Munk as Barrick chairman in 2014, who took the most criticism.

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Barrick’s assets more ‘damaged’ than the company has disclosed: Newmont CEO – by Gabriel Friedman (Financial Post – March 5, 2019)

https://business.financialpost.com/

Newmont Mining Corp. officially rejected a US$17.8 billion hostile bid from Barrick Gold Corp. on Monday, and its chief executive Gary Goldberg went on the offensive.

In a call with investors and an interview with the Financial Post, Goldberg questioned why Barrick has not issued guidance beyond 2019, and suggested the company’s assets are in worse shape than has been publicly disclosed.

“Barrick has a problem and that’s why they need to push this,” he told the Financial Post. The bid by Barrick, which represents an eight per cent discount to the value of Newmont’s shares on the day it was proposed, has the potential to reshape the gold mining industry by creating an estimated US$42 billion company — which would be multiple times larger than its next nearest competitor.

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Agnico Eagle CEO wary of ‘bigger is better’ mergers – by Gabriel Friedman (Financial Post – March 4, 2019)

https://business.financialpost.com/

His company wants nothing to do with the merger mania suddenly sweeping the gold mining sector

Speaking to a packed house on Sunday at the Prospectors and Developers Association Conference in downtown Toronto, Sean Boyd, chief executive of Agnico Eagle Mines Ltd., delivered a simple message: His company wants nothing to do with the merger mania suddenly sweeping the gold mining sector.

“The recent M&A is just competitive positioning among the biggest players in this business — not wanting to be left behind,” Boyd told a room of several hundred people.

The comments came as tens of thousands of mining investors and executives flock to Toronto for a conference that runs through Wednesday and has historically provided an opportunity for dealmaking, and for reflection on industry trends.

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Why a Barrick takeover of Newmont would do little for gold investors – by Ian McGugan (Globe and Mail – February 27, 2019)

https://www.theglobeandmail.com/

Many people have described Barrick Gold Corp.’s hostile takeover offer for Newmont Mining Corp. as audacious. A better word might be “unnecessary.”

Unnecessary, that is, from an investor’s perspective. A successful bid would no doubt do wonders for the compensation of Barrick executives, who would wind up running the biggest gold company in the world by far.

However, a tie-up between Barrick and Newmont would do relatively little for gold lovers, who can already target all the precious-metals exposure they want through other channels.

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