Barrick Gold : Newmont rejects Barrick's buyout offer, proposes Nevada JV
(Reuters) - Newmont Mining Corp rejected rival Barrick Gold Corp's $18 billion buyout offer on Monday, but proposed a joint venture in Nevada instead, a deal worth billions that would create a major operator in the largest U.S. gold-producing region.
Both the buyout rejection and the JV proposal were expected.
"Barrick's egocentric proposal is designed to transfer value from Newmont's shareholders to Barrick," Newmont's chief executive, Gary Goldberg, said on an investor call.
In a statement later on Monday, Barrick CEO Mark Bristow said the JV proposal was "stale and convoluted" and that both companies' Nevada assets would be better run by a single company.
"We know we can do that more efficiently than Newmont and that it will be worth a lot more to both Newmont and Barrick shareholders under that scenario," Bristow said. He did not directly respond to Newmont's rejection of the buyout offer.
The proposed Barrick deal would combine two of the biggest gold producers in the world at a time when both companies are trying to bolster shrinking gold reserves to boost growth as well as take advantage of rising prices.
Newmont said its Canadian rival's all-stock offer was not in the best interest of its shareholders as it was offered at a discount.
Barrick's offer of 2.5694 common shares for each Newmont share was equivalent to about $33 per share, which represented a discount of $3.48 to Newmont's closing price on Feb. 22, the last trading day before the offer was announced.
Newmont shares have fallen about 6 percent since Barrick's offer.
https://www.marketscreener.com/BARRICK-GOLD-CORP-1408870/news/Barrick-Gold-Newmont-rejects-Barrick-s-buyout-offer-proposes-Nevada-JV-28106275/