US-based Newmont has secured clearance from the Canadian Competition Bureau for its previously announced A$28.8bn ($19.5bn) acquisition of rival Australian gold mining company Newcrest Mining.
In this regard, Newmont has been issued a “no action” letter from the Canadian Competition Bureau. The letter clears the deal under Canadian competition law.
Newmont said that it is advancing towards obtaining regulatory approvals in other jurisdictions and expects the deal to be completed in Q4 2023.
Both parties signed a binding scheme implementation deed (SID) in May 2023.
Newcrest Mining has operating mines in Australia, Papua New Guinea, and Canada, while Newmont has operations in mining jurisdictions in North America, Australia, Africa, and South America.
The deal represents an equity value of A$26.2bn ($17.74bn) to the Australia-based gold mining company.
The consideration of the deal represents a premium of 30.4% to Newcrest Mining’s closing price of A$22.45 ($15.2) per share on 3 February 2023.
Following the closing of the proposed deal, the combined company aims to deliver a multi-decade production profile from 10 large, long-life, low cost, Tier 1 operations.
Besides, the merged entity will provide an increased annual copper production primarily from Australia and Canada.
Furthermore, the combined business is projected to generate annual pre-tax synergies of $500m within the first 24 months.
It is also targeting at least $2bn in the first two years after completing the deal through portfolio optimisation.
Last month, Newmont announced an investment of $540m to extend the life of its Cerro Negro gold mine in Santa Cruz province, Argentina, to 2034.
The investment is anticipated to improve its production to more than 350,000 ounces from next year and provide scope for further exploration and additional expansions.
