8-KFinancial EventsOther EventsExhibits & Filings

NEWMONT Corp /DE/ 8-K Report, Financial Obligation (Dec 21, 2021)

Filed December 21, 2021For Securities:NEMNEMCL

Summary

Newmont Corporation (NEM) has filed an 8-K report detailing the closing of its $1 billion offering of 2.600% Sustainability-Linked Senior Notes due 2032 on December 20, 2021. The primary use of the net proceeds, approximately $992 million, is to fund the repurchase of outstanding 3.700% Notes due 2023, both those issued by Newmont and its subsidiary Goldcorp Inc. This strategic move aims to refinance existing debt, potentially lowering interest expenses and optimizing the company's debt maturity profile. The sustainability-linked nature of the new notes introduces an interesting dynamic, as the interest rate could increase if specific environmental and social performance targets are not met by December 31, 2030. This structure aligns Newmont's financing costs with its sustainability commitments, signaling a growing trend in corporate finance. The company has also outlined terms for redemption and potential repurchase events, including a change of control, providing investors with an understanding of debt holder protections.

Key Highlights

  • 1Newmont Corp. closed a $1 billion offering of 2.600% Sustainability-Linked Senior Notes due 2032.
  • 2Proceeds will primarily be used to repurchase outstanding 3.700% Notes due 2023 issued by Newmont and Goldcorp Inc.
  • 3The new notes carry an interest rate that can increase if sustainability performance targets are not met by year-end 2030.
  • 4The offering is registered under the Securities Act of 1933 via a Form S-3ASR.
  • 5The notes are unsecured senior obligations of Newmont Corporation, guaranteed on a senior unsecured basis by Newmont USA Limited.
  • 6The filing includes the Fifth Supplemental Indenture, detailing the terms of the new notes, and related exhibits such as legal opinions and a press release.
  • 7The transaction is structured to refinance existing debt and potentially optimize Newmont's capital structure.

Frequently Asked Questions

The primary purpose of issuing the new $1 billion in 2.600% Sustainability-Linked Senior Notes due 2032 is to fund the repurchase of Newmont's and Goldcorp Inc.'s outstanding 3.700% Notes due 2023. This is a debt refinancing activity aimed at managing the company's debt maturity profile and potentially reducing interest expenses.

Sustainability-Linked means that the interest rate on these notes is tied to Newmont's performance against predefined sustainability targets. If the company fails to meet certain specified Sustainability Performance Targets (SPT 1, SPT 2, and SPT 3) by December 31, 2030, the annual interest rate on the notes will increase. This incentivizes the company to achieve its environmental and social goals.

Newmont is conducting tender offers to repurchase its 3.700% Notes due 2023 and the 2023 Notes issued by Goldcorp Inc. The proceeds from the new note issuance will be used for this purpose, up to certain specified aggregate principal amounts. Any remaining proceeds after the tender offers will be used for working capital and other general corporate purposes.

The new notes are unsecured senior obligations of Newmont Corporation. They rank equally with the company's existing and future unsecured senior debt and senior to its future subordinated debt. The notes are guaranteed on a senior unsecured basis by Newmont USA Limited.