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Newmont (New York Stock Exchange: NO) has made a non-binding offer to acquire Newcrest Mining (OTCPK:NCMGF) (OTCPK:NCMGY), Australia’s top gold miner said on Sunday.
Under the terms of the proposed agreement, shareholders of Newcrest (OTCPK:NCMGF) (OTCPK:NCMGY) would receive 0.38 Newmont (NEM) shares for each Newcrest share held, which values Newcrest at ~$17 billion.
Newcrest (OTCPK:NCMGF) (OTCPK:NCMGY) said its board is considering the proposal, which is conditional on Newmont (NEM) receiving exclusive due diligence.
Newmont (NEM) made an earlier offer with an exchange ratio of 0.363, which the board of directors of Newcrest (OTCPK:NCMGF) (OTCPK:NCMGY) rejected.
Mining stocks such as Newmont (NEM) “offer a potential hedge against recession, as a strong ‘Fed pivot’ could propel gold to a new all-time high,” writes Harrison Schwartz in an analysis published recently in Seeking Alpha.
