Bitter takeover battle ends in agreement to combine the two companies’ mining operations in Nevada
TORONTO — Barrick Gold Corp. dropped its hostile takeover offer for Newmont Mining Corp. on Monday in favour of a friendly deal to create a joint-venture that will combine the two companies’ mining operations in Nevada.
“Our joint venture will allow us to tear down the fences and operate our assets as one mining complex, making the best use of our combined infrastructure.” For Newmont, it will be able to continue with a proposed friendly takeover of Vancouver-based Goldcorp Inc., which said it fully supports the joint venture.
The joint venture will include Barrick’s Goldstrike, Cortez, Turquoise Ridge, Goldrush mines and other assets as well as Newmont’s Carlin, Twin Creeks, Phoenix, Long Canyon, and Lone Tree mines. RBC has estimated annual savings of US$340 million pre-tax, or US$250 million after tax, which it figures is currently worth about US$2.6 billion over 20 years.
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