Summary
Newmont Mining Corporation (Newmont) announced a significant divestiture through an Acquisition Agreement with Franco-Nevada Corporation, filed on November 30, 2007. Newmont is selling its Royalty Portfolio, which includes certain mineral royalties and oil and gas interests, for an estimated value of $1.3 billion. This strategic move is intended to monetize these assets to fund the development of Newmont's core gold business. The transaction is structured as a sale to Franco-Nevada, with Newmont receiving cash consideration derived from Franco-Nevada's initial public offering in Canada, shares issued to Franco-Nevada's management, and a committed bank facility. The deal is expected to close around December 20, 2007. Newmont anticipates recording a substantial pre-tax gain of approximately $0.95 billion from discontinued operations in the fourth quarter of 2007.
Key Highlights
- 1Newmont to sell its Royalty Portfolio to Franco-Nevada for approximately $1.3 billion.
- 2Proceeds will be used to fund the development of Newmont's core gold mining business.
- 3Transaction involves cash consideration from Franco-Nevada's IPO, management share issuance, and bank financing.
- 4Expected closing date for the transaction is December 20, 2007.
- 5Newmont anticipates a pre-tax gain of approximately $0.95 billion from discontinued operations.
- 6Pierre Lassonde resigned from Newmont's board and will serve as Non-Executive Chairman of Franco-Nevada.
- 7Consulting agreement with Pierre Lassonde has been terminated.