Newmont gets 66%

Denver-based Newmont Mining (NEM-N) says it has acquired more than 66% of the shares of Normandy Mining (NDY-T), and as a result has declared its bid for the Australian miner free of all remaining conditions.

The milestone also means that all remaining conditions necessary for completion of Newmont’s acquisition of Toronto-based Franco-Nevada Mining (FN-T) have now been satisfied or waived.

All Normandy shareholders that tendered their shares to Newmont’s bid by 7 P.M. Sydney time on Feb. 15 will receive payment at the end of trading on the Australian stock Exchange on Feb. 20. Shareholders who subsequently accept the bid will be paid within five business days. Newmont’s offer is slated to expire on Feb. 26 at 7 P.M. Sydney time.

Newmont’s winning bid for Normandy includes a cash sweetener of A50 per share on top of 0.0385 of a share for every Normandy share. That offer came out on top after a 4-month battle with South Africa’s Anglogold (AU-N).

Newmont says its acquisition of Franco will wrap up on Feb. 16, 2002. Under that deal, Franco shareholders are offered 0.8 of a share per Franco-Nevada share.

Once both deals are competed, Newmont’s current shareholders will own 50% of the new Newmont (headquartered in Australia), Franco-Nevada shareholders, 32%, and Normandy shareholders, 18%.

Post-merger Newmont will boast: annual production of more than 8 million oz. at a cash cost of about US$175 per oz.; the highest reserve base — 97 million oz. spread across 30 mines; and a market capitalization in the neighbourhood of US$8 billion, rivalling that of Barrick Gold (ABX-T), the industry leader. The new company’s net debt-to-market capitalization rings in at 23%, largely reflecting the consolidation of Franco-Nevada’s cash-heavy balance sheet, compared with a ratio of 20% for Barrick.

Newmont’s Canadian exchangeable shares will begin trading on the Toronto Stock Exchange on Feb. 20, under the symbol NMC. The company’s CDIs (depository receipts for debt-type securities either foreign or Australian) are expected to be trading on the Australian Stock Exchange by Feb. 25, under the symbol NEM.