Newcrest Mining Limited (ASX: NCM) has chosen to reject a US$17 billion takeover bid from Newmont Mining (NYSE: NEM) (TSX: NGT) over a perceived lack of shareholder value from the offer.
The deal was proposed by Newmont on February 5 and Newcrest notified the public of its refusal on Thursday. The proposed deal was the biggest news in the global gold mining industry at the time.
However, Newcrest has made it clear that it is open to the possibility of a superior offer from Newmont, the world’s largest gold mining company. The Australian company says it will open its books for Newmont and continue to inform the market of any developments between the gold producers.
“There is no certainty that any further discussions with Newmont will lead to a revised proposal or any transaction,” read a news release from Newcrest on Thursday.
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Newcrest’s Interim CEO Sherry Duhe stated in an interview with Bloomberg TV that the decision to reject Newmont’s new offer was unanimous and required little deliberation. She feels the company is worth a lot more than Newmont’s offer.
The most recent offer by Newmont this month was approximately 5 per cent higher than a previous offer made by the company, according to a statement disclosed to mining.com earlier this month.
“Our board together with ourselves as management looked at both of those offers very carefully, considered what was in the best interest of our shareholders, and it was quite unanimous that we rejected the first and second offer,” said Duhe on Wednesday.
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In other news, Newmont has appointed a new executive vice president and chief operating officer with over three decades of experience.
Natascha Viljoen will be stepping in for the dual role at the company following the conclusion of a notice period of up to 12 months from her role as CEO of Anglo American plc (LON: AAL)’s platinum business.
Viljoen is responsible for managing a team of 25,000 in her current role with Anglo American. She has held several other influential roles in the past and Newmont feels she will be a valuable asset.
“Natascha has shown outstanding leadership transforming technical processing capabilities at Anglo American and we are excited to have her join the Newmont Executive Leadership Team,” said Tom Palmer, President and CEO of Newmont.
Newcrest’s stock price dropped by 0.45 per cent today to $22.16 while Newmont’s share value decreased by 0.6 per cent to $61.66 on the TSX.
rowan@mugglehead.com
