Normandy board eyes sweeter deal

Normandy Mining‘s (NDY-T) board of directors is telling shareholders to hold on even in the face of a sweetened offer from South Africa’s AngloGold (AU-N).

In a prepared statement on Monday, Normandy said, “shareholders should do nothing with respect to the AngloGold offer until they receive a formal recommendation from their board.”

“Given the interest in Normandy from two bidders and the extension of AngloGold’s offer period, the Normandy board considers there is potential for further developments.”

The Australian miner is at the centre of battle between AngloGold, the world’s largest gold miner, and U.S.-based Newmont Mining (NEM-N), and Normandy’s board believes that given the interest of the two bidders, it is premature for it to make any recommendation on whether or not to accept the revised AngloGold offer.

On Nov. 28, Anglo boosted its original offer of 2.15 Anglo shares for every 100 Normandy shares held to include a cash payment A20 per share. The company also removed all defeating conditions from the offer, including the minimum acceptance condition. The improved bid, which is subject to Anglo shareholder approval, closes out on Dec. 27.

Turning up the heat on Normandy shareholders, Anglo has raised the handling fees it will pay brokers to encourage Normandy shareholders to submit their shares by Dec. 11.

Based on an assumed AngloGold share price of A$65 per share, brokers would receive:

• 2.5% of the value of the consideration payable for up to 50,000 Normandy shares;
• 1.5% for 50,001 to 100,000 shares;
• 1.25% for 100,001 to 1 million shares; and
• 1% for more than 1 million shares.

For acceptances marked after Dec. 11, brokers would receive the original fees of 0.75% percent of the consideration payable to shareholders, and up to a maximum of A$750 per individual acceptance form.

Anglo has also accelerated its payment terms. For acceptances received by the end of business on Dec. 17, 2001, AngloGold will pay by Dec. 20. After Dec. 17, payment would be received within 5 business days.

Newmont’s bid remains at about A$1.51 per share. The bid includes a cash bonus of A5 per share provided at least 90% of Normandy’s shares are tendered to its offer. Normandy’s largest shareholder Franco-Nevada Mining (FN-T) has committed its 19.9% stake in Normandy to Newmont’s offer. Newmont has also offered 0.8 Newmont shares for every Franco share, provided its Normandy bid is successful. Newmont is reviewing AngloGold’s revised offer and says it will respond in due course.